EX-4.1






EXHIBIT – 4.1




LOAN AGREEMENT




dated as of July 14, 2008




by and between




AGREE LIMITED PARTNERSHIP,

a Delaware limited partnership,

as Borrower




THE FINANCIAL INSTITUTIONS PARTY HERETO, as Co-Lenders




and




LASALLE BANK MIDWEST NATIONAL ASSOCIATION,

a national banking association, as Agent





 









 








TABLE OF CONTENTS




	 	 	 	 	 
	Article	 	Page	 
	ARTICLE 1 INCORPORATION AND DEFINITIONS
	 	 	1	 
	1.1 Incorporation and Definitions
	 	 	1	 
	 
	 	 	 	 
	ARTICLE 2 REPRESENTATIONS AND WARRANTIES
	 	 	7	 
	2.1 Representations and Warranties
	 	 	7	 
	2.2 Continuation of Representations and Warranties
	 	 	9	 
	 
	 	 	 	 
	ARTICLE 3 AMOUNT AND TERMS OF LOANS
	 	 	9	 
	3.1 Agreement to Lend and to Borrow; Notes
	 	 	9	 
	3.2 Commitments Several
	 	 	10	 
	 
	 	 	 	 
	ARTICLE 4 PRINCIPAL, INTEREST; SPECIAL PROVISIONS FOR LIBOR LOANS
	 	 	10	 
	4.1 Interest Rates
	 	 	10	 
	4.2 Payment of Principal and Interest
	 	 	10	 
	4.3 Types of Loans; Setting and Notice of LIBOR Rates
	 	 	11	 
	4.4 Conversion and Continuation Procedures
	 	 	12	 
	4.5 Computation of Interest and Fees
	 	 	12	 
	4.6 Inability to Determine Interest Rate
	 	 	13	 
	4.7 Pro Rata Treatment and Payments
	 	 	13	 
	4.8 Illegality
	 	 	13	 
	4.9 Legal Requirements
	 	 	13	 
	4.10 Taxes
	 	 	14	 
	4.11 LIBOR Loan Indemnification
	 	 	15	 
	 
	 	 	 	 
	ARTICLE 5 LOAN DOCUMENTS
	 	 	16	 
	5.1 Loan Documents
	 	 	16	 
	 
	 	 	 	 
	ARTICLE 6 CONDITIONS TO LOAN CLOSING
	 	 	17	 
	6.1 Conditions to Loan Closing
	 	 	17	 
	6.2 Termination of Agreement
	 	 	20	 
	 
	 	 	 	 
	ARTICLE 7 DISBURSEMENTS
	 	 	20	 
	7.1 Conditions Precedent to Disbursement of Loan Proceeds
	 	 	20	 
	7.2 Advances by Banks
	 	 	22	 
	7.3 Expenses and Advances Secured by Mortgages
	 	 	22	 
	7.4 Acquiescence not a Waiver
	 	 	22	 
	7.5 Agent’s Action for Agent’s Own Protection Only
	 	 	22	 
	 
	 	 	 	 
	ARTICLE 8 FURTHER AGREEMENTS OF BORROWER
	 	 	23	 
	8.1 Furnishing Information
	 	 	23	 
	8.2 Compliance with Covenants; Prohibition Against Additional Recordings
	 	 	23	 
	8.3 Property Accounts
	 	 	23	 
	8.4 Distributions
	 	 	23	 
	8.5 Further Assurance
	 	 	24	 






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	Article	 	Page	 
	ARTICLE 9 CASUALTIES AND CONDEMNATION
	 	 	24	 
	9.1 Application of Insurance Proceeds and Condemnation Awards
	 	 	24	 
	 
	 	 	 	 
	ARTICLE 10 ASSIGNMENTS, SALE AND ENCUMBRANCES
	 	 	24	 
	10.1 Bank Assignments, Participations
	 	 	24	 
	10.2 Prohibition of Assignments and Encumbrances by Borrower
	 	 	25	 
	10.3 Partial Releases of Property
	 	 	25	 
	 
	 	 	 	 
	ARTICLE 11 EVENTS OF DEFAULT BY BORROWER
	 	 	26	 
	11.1 Event of Default Defined
	 	 	26	 
	 
	 	 	 	 
	ARTICLE 12 AGENT’S REMEDIES UPON EVENT OF DEFAULT
	 	 	27	 
	12.1 Remedies Conferred upon Agent
	 	 	27	 
	12.2 Right of Banks to Make Advances to Cure Event of Defaults; Obligatory Advances
	 	 	27	 
	12.3 Attorneys Fees
	 	 	28	 
	12.4 No Waiver
	 	 	28	 
	12.5 Default Rate
	 	 	28	 
	 
	 	 	 	 
	ARTICLE 13 THE AGENT
	 	 	28	 
	13.1 Appointment and Authorization
	 	 	28	 
	13.2 Actions Requiring Consent and Approval
	 	 	29	 
	13.3 Liability of Agent
	 	 	31	 
	13.4 Reliance by Agent
	 	 	31	 
	13.5 Notice of Default
	 	 	32	 
	13.6 Credit Decision
	 	 	32	 
	13.7 Bank Indemnification
	 	 	32	 
	13.8 Agent in Individual Capacity
	 	 	32	 
	13.9 Successor Agent
	 	 	33	 
	13.10 Collateral Matters
	 	 	33	 
	13.11 Agent May File Proofs of Claim
	 	 	33	 
	 
	 	 	 	 
	ARTICLE 14 MISCELLANEOUS
	 	 	34	 
	14.1 Time is of the Essence
	 	 	34	 
	14.2 Agent’s Determination of Facts
	 	 	34	 
	14.3 Prior Agreements
	 	 	34	 
	14.4 Disclaimer by Banks
	 	 	34	 
	14.5 Borrower Indemnification
	 	 	34	 
	14.6 Captions
	 	 	35	 
	14.7 Inconsistent Terms and Partial Invalidity
	 	 	35	 
	14.8 Gender and Number
	 	 	35	 
	14.9 Notices
	 	 	35	 
	14.10 Effect of Agreement
	 	 	36	 
	14.11 Governing Law
	 	 	36	 
	14.12 Consent to Jurisdiction
	 	 	36	 
	14.13 Waiver of Jury Trial
	 	 	36	 
	14.14 Counterparts; Facsimile Signatures
	 	 	37	 
	 
	 	 	 	 
	14.15 Customer Identification — USA Patriot Act Notice
	 	 	37	 






SCHEDULES




Schedule 3.1 – Loan Amounts

Schedule 10.1 — Schedule of Release Payments




EXHIBITS




EXHIBIT “A” — THE PROPERTY

EXHIBIT “B” – FORM OF PROMISSORY NOTE

EXHIBIT “C” — PERMITTED EXCEPTIONS

EXHIBIT “D” — FORM OF ASSIGNMENT AND ACCEPTANCE




ii









 





LOAN AGREEMENT




     This LOAN AGREEMENT dated as of July 14, 2008 (the “Agreement”), is executed by and
among AGREE LIMITED PARTNERSHIP, a Delaware limited partnership (the “Borrower”), the
financial institutions that are or may from time to time become parties hereto and are described on
Schedule 3.1 hereto (together with LaSalle and their respective successors and assigns, the
“Banks”) and LASALLE BANK MIDWEST NATIONAL ASSOCIATION, a national banking association (in
its individual capacity, “LaSalle”), as agent for itself and the other Banks.



R E C I T A L S:




     A. Borrower is the owner or land lessee of the properties described in Exhibit “A”
attached hereto (being collectively referred to herein as the “Property”).



     B. Borrower has applied to the Banks for the Loans (as hereinafter defined) for the purpose of
financing the Property, and the Banks are willing to make the Loans upon the terms and conditions
hereinafter set forth.



     NOW, THEREFORE, in consideration of the mutual representations, warranties, covenants and
agreements herein contained, the sufficiency of which is hereby acknowledged, the parties hereto
represent and agree as follows:



ARTICLE 1




INCORPORATION AND DEFINITIONS




     1.1 Incorporation and Definitions. The foregoing recitals and all exhibits hereto are
hereby made a part of this Agreement. The following terms shall have the following meanings in
this Agreement:




     “Actual Knowledge”: Knowledge acutally possessed by Richard Agree, or his
successor, without inquiry or additional investigation, and not constructive knowledge which
is imputed to the Borrower.




     “Agent”: As of the date hereof, LaSalle in its capacity as agent for the Banks
and any successor or assign of LaSalle in such capacity.




     “Applicable Margin”: With respect to LIBOR Loans, one and one-half percent
(1.50%) per annum and with respect to Base Rate Loans, one percent (1.00%) per annum.




     “Assignments of Rents”: As defined in Section 5 hereof




     “Bank(s)”: As defined in the Preamble.




     “Bank Affiliate” means RJ Capital Services, Inc., an affiliate of Raymond James
Bank, FSB, and any other affiliate of any Bank, and their respective successors and assigns.




     “Base Rate Loan”: Any Loan which bears interest at a rate determined by
reference to the Base Rate.



 









 






     “Base Rate”: At any time, the greater of the Federal Funds Rate plus
one-half of one percent (0.50%) and the Prime Rate.




     “Borrower”: As defined in the Preamble.




     “Business Day”: Any day other than a Saturday, Sunday or a legal holiday on
which banks are authorized or required to be closed for the conduct of commercial banking
business in Troy, Michigan.




     “Commitment Fee”: A commitment fee in the amount of three eights of one
percent (.375%) of the Loan Amount, payable to the Banks according to their Pro-Rata Shares
in consideration for their commitments to make the Loans.




     “Debt Service”: For any fiscal year, the sum of all scheduled principal and
interest payments on the Loans which are due and payable during such fiscal year.




     “Debt Service Coverage Ratio”: For any fiscal year, the ratio of Net Operating
Income to Debt Service.




     “Default Rate”: As defined in Section 4.1 hereof.




     “Environmental Indemnity Agreement”: As defined in Section 5 hereof.




     “Environmental Laws”: As defined in the Environmental Indemnity.




     “ERISA”: The Employee Retirement Income Security Act of 1974.




     “Eurocurrency Reserve Percentage”: With respect to any LIBOR Loan for any
Interest Period, a percentage (expressed as a decimal) equal to the daily average during
such Interest Period of the percentage in effect on each day of such Interest Period, as
prescribed by the FRB, for determining the aggregate maximum reserve requirements applicable
to “Eurocurrency Liabilities” pursuant to Regulation D or any other then applicable
regulation of the FRB which prescribes reserve requirements applicable to “Eurocurrency
Liabilities” as presently defined in Regulation D.




     “Event of Default”: One or more of the events or occurrences referred to in
Article 11 of this Agreement.




     “Federal Funds Rate”: For any day, a fluctuating interest rate equal for each
day during such period to the weighted average of the rates on overnight Federal funds
transactions with members of the Federal Reserve System arranged by Federal funds brokers,
as published for such day (or, if such day is not a Business Day, for the next preceding
Business Day) by the Federal Reserve Bank of New York, or, if such rate is not so published
for any day which is a Business Day, the average of the quotations for such day on such
transactions received by the Agent from three Federal funds brokers of recognized standing
selected by the Agent. The Agent’s determination of such rate shall be binding and
conclusive absent manifest error.




     “FRB”: The Board of Governors of the Federal Reserve System or any successor
thereof.




     “GAAP”: Generally accepted accounting principles set forth from time to time
in the opinions and pronouncements of the Accounting Principles Board and the American
Institute of



2









 






Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board (or agencies with similar functions of comparable stature and
authority within the U.S. accounting profession), which are applicable to the circumstances
as of the date of determination, provided, however, that interim financial statements or
reports shall be deemed in compliance with GAAP despite the absence of footnotes and fiscal
year-end adjustments as required by GAAP.




     “Governmental Authority”: Any nation or government, any state or other
political subdivision thereof and any entity exercising executive, legislative, judicial,
regulatory or administrative functions of or pertaining to government.




     “Guarantor”: Agree Realty Corporation, a Maryland corporation.




     “Hazardous Materials”: As defined in the Environmental Indemnity.




     “Interest Period”: As to any LIBOR Loan, the period commencing on the date such
Loan is borrowed or continued as a LIBOR Loan and ending on the date one, two or three
months thereafter as selected by Borrower pursuant to Section 4.3; provided that:




     (i) each Interest Period occurring after the initial Interest Period of any
LIBOR Loan shall commence on the day on which the preceding Interest Period for such
LIBOR Loan expires;




     (ii) if any Interest Period would otherwise end on a day that is not a Business
Day, such Interest Period shall be extended to the following Business Day unless the
result of such extension would be to carry such Interest Period into another
calendar month, in which event such Interest Period shall end on the preceding
Business Day;




     (iii) any Interest Period that begins on a day for which there is no
numerically corresponding day in the calendar month at the end of such Interest
Period shall end on the last Business Day of the calendar month at the end of such
Interest Period; and




     (iv) Borrower may not select any Interest Period for a Loan which would extend
beyond the scheduled Maturity Date.




     “LaSalle”: As defined in the Preamble.




     “Lease(s)”: Any and all leases, licenses or agreements for use of any part of
the Property.




     “Legal Requirements”: As to any person or party, the Articles of Incorporation
or Organization and bylaws, operating agreement, partnership agreement or other
organizational or governing documents of such person or party, and any law, treaty, rule or
regulation or determination of an arbitrator or a court or other governmental authority, in
each case applicable to or binding upon such person or party or any of its property or to
which such person or party or any of its property is subject.




     “LIBOR Loan”: Any Loan which bears interest at a rate determined by reference
to the LIBOR Rate (Reserve Adjusted).



3









 






     “LIBOR Office”: With respect to any Bank, the office or offices of such Bank
which shall be making or maintaining the LIBOR Loans of such Bank hereunder. A LIBOR Office
of any Bank may be, at the option of such Bank, either a domestic or foreign office.




     “LIBOR Rate”: With respect to any LIBOR Loan for any Interest Period, the per
annum rate of interest at which United States dollar deposits in an amount comparable to the
amount of such LIBOR Loan and for a period equal to the relevant Interest Period are offered
in the London Interbank Eurodollar market at 11:00 a.m. (London time) two (2) Business Days
prior to the commencement of such Interest Period (or three Business Days prior to the
commencement of such Interest Period if banks in London, England were not open and dealing
in offshore United States dollars on such second preceding Business Day), as displayed in
the Bloomberg Financial Markets system (or other authoritative source selected by the Agent
in its sole discretion).




     “LIBOR Rate (Reserve Adjusted)”: With respect to any LIBOR Loan for any
Interest Period, a rate per annum equal to (A) the LIBOR Rate, divided by (B) a number
determined by subtracting from 1.00 the Eurocurrency Reserve Percentage.




     “Loan Amount”: The aggregate principal amount of the Loans, which is equal to
Twenty Four Million Eight Hundred Thousand and 00/100 Dollars ($24,800,000.00). The amount
of each Bank’s Pro Rata Share of the Loan Amount is set forth on Schedule 3.1 attached
hereto.




     “Loan Documents”: This Agreement, the documents specified in Article 5 hereof
and any other instruments evidencing, securing or guarantying obligations of any party under
the Loans.




     “Loan Expenses”: As defined in Section 7.2(b) hereof.




     “Loan Closing”: The first disbursement of the Loans.




     “Loan Closing Date”: July 14, 2008.




     “Loan Proceeds”: All amounts advanced as part of the Loans, whether advanced
directly to Borrower or otherwise.




     “Loans”: The loans to be made by the Banks pursuant to this Agreement.




     “Maturity Date”: Initially, July 14, 2013, which shall be subject to extension
at the Borrower’s option as provided in Section 4.2(b).




     “Mortgages”: As defined in Section 5 hereof.




     “Net Operating Income”: For any fiscal year, the gross income derived from the
operation of the Property, on a combined basis, less Operating Expenses attributable to the
Property, on a combined basis, accounted for on an accrual basis, in accordance with GAAP,
including any rent loss or business interruption insurance proceeds, and water and sewer
charges, which are actually received and Operating Expenses actually paid or payable on an
accrual basis attributable to the Property as set forth on operating statements satisfactory
to Agent. Notwithstanding the foregoing, Net Operating Income shall not include (i) any
condemnation or insurance proceeds (excluding rent or business interruption insurance
proceeds), (ii) any proceeds resulting from the sale, exchange, transfer, financing or
refinancing of all or any portion of the Property, (iii) amounts received from tenants as
security deposits, (iv) amounts received from



4









 






affiliates of the Borrower or the Guarantor, which amounts do not represent
pass-through rent payments received from bona-fide third party tenants, (v) interest income,
and (vi) any type of income otherwise included in Net Operating Income but paid directly by
any tenant to anyone other than Borrower or the Guarantor or its agents or representatives.




     “Non-Excluded Taxes”: As defined in Section 4.10 hereof.




     “Note(s)”: Collectively, the notes made by Borrower payable to each Bank in
the aggregate amount of the Loans and in the Form of Exhibit “B” hereto.




     “Operating Expenses”: For any given period (and shall include the pro rata
portion for such period of all such expenses attributable to, but not paid during, such
period) all expenses to be paid or payable, as determined in accordance with GAAP, by
Borrower or the Guarantor during that period in connection with the operation of the
Property, including without limitation:




     (i) expenses for cleaning, repair, mantenance, decoration and painting of the Property
(including, without limitation, parking lots and roadways), net of any insurance preceeds in
respect of any of the foregoing;




     (ii) wages (including overtime payments), benefits, payroll taxes and all other related
expenses for Borrower’s and the Guarantor’s on-site personnel, engaged in the repair,
operation and maintenance of the Property and service to tenants and on-site personnel
engaged in audit and accounting functions performed by Borrower;




     (iii) actual management fees, if any, together with any allocated management fees or
similar fees received from tenants or other parties. Such fees shall include all fees for
management services whether such services are performed at the Proeprty or off-site;




     (iv) the cost of all electricity, oil, gas, water, steam, heat, ventilation, air
conditioning and any other energy, utility or similar item and the cost of building and
cleaning supplies;




     (v) the cost of leasing commissions and tenant concessions or improvements payable by
Borrower or the Guarantor pursuant to any leases which are in effect for the Property at the
commencement of that period as such costs are recognized in accordance with GAAP, but on no
less than a straight line basis over the remaining term of the respective Lease, exclusive
of any renewal or extension or similar options;




     (vi) rent, liability, casualty and fidelity insurance premiums;




     (vii) legal, accounting and other professional fees and expenses;




     (viii) the cost of all equipment to be used in the ordinary course of business, which
is not capitalized in accordance with GAAP;




     (ix) real estate and other taxes;




     (x) advertising and other marketing costs and expenses;




     (xi) casualty losses to the extent not reimbursed by a third party;




     (xii) any ground lease payments; and



5









 






     (xiii) all amounts that should be reserved, as reasonably determined by Borrower and
the Guarantor with approval by Agent in its reasonable discretion, for repair or maintenance
of the Property and to maintain the value of the Property.




     Nothwithstanding the foregoing, Operating Expenses shall not include (i) depreciation
or amortization or any other non-cash item of expense; (ii) interest, principal, fees, costs
and expense reimbursements of Agent in administering the Loan but not in exercising any of
its rights under this Agreement or the Loan Documents; or (iii) any expenditure (other than
leasing commissions, tenant concessions and improvements, and replacement reserves) which is
properly treatable as a capital item under GAAP.




     “Permitted Exceptions”: The title exceptions specified in Exhibit “C”
hereto, together with such additional exceptions as may be approved in writing by Agent or
are permitted by the terms hereof.




     “Prime Rate”: For any day, the rate of interest most recently announced by
LaSalle at Troy, Michigan as its prime or base rate. A certificate made by an officer of
LaSalle stating the Prime Rate in effect on any given day, for the purposes hereof, shall be
conclusive evidence of the Prime Rate in effect on such day. The Prime Rate is a base
reference rate of interest adopted by LaSalle as a general benchmark from which LaSalle
determines the floating interest rates chargeable on various loans to borrowers with varying
degrees of creditworthiness and Borrower acknowledges and agrees that LaSalle has made no
representations whatsoever that the Prime Rate is the interest rate actually offered by
LaSalle to borrowers of any particular creditworthiness. The effective date of any change
in the Prime Rate shall for purposes hereof be the date the Prime Rate is changed by
LaSalle. LaSalle shall not be obligated to give notice of any change in the Prime Rate.




     “Property”: As defined in the Recitals to this Agreement.




     “Pro Rata Share”: As to any Bank at any time, the percentage the aggregate
principal amount of such Bank’s Loan then outstanding bears to the aggregate principal
amount of the Loans then outstanding, as described on Schedule 3.1 attached hereto.




     “Rate Management Agreement” means any agreement, device or arrangement
providing for payments which are related to fluctuations of interest rates, exchange rates,
forward rates, or equity prices, including, but not limited to, dollar-denominated or
cross-currency interest rate exchange agreements, forward currency exchange agreements,
interest rate cap or collar protection agreements, forward rate currency or interest rate
options, puts and warrants, and any agreement pertaining to equity derivative transactions
(e.g., equity or equity index swaps, options, caps, floors, collars and forwards), including
without limitation any and all obligations under any and all swap agreements as defined in
11 USC 1, Ch. 101 between the Borrower and any of the Banks and/or any Bank Affiliate and
any ISDA Master Agreement between Borrower and any Bank and/or any Bank Affiliate, and any
schedules, confirmations and documents and other confirming evidence between the parties
confirming transactions thereunder, all whether now existing or hereafter arising, and in
each case as amended, modified or supplemented from time to time.




     “Rate Management Obligations” means any and all obligations of Borrower to any
Bank and/or Bank Affiliate, whether absolute, contingent or otherwise and howsoever and
whensoever (whether now or hereafter) created, arising, evidenced or acquired (including all
renewals, extensions and modifications thereof and substitutions therefore), under or in
connection with (i)



6









 






any and all Rate Management Agreements, and (ii) any and all cancellations, buy-backs,
reversals, terminations or assignments of any Rate Management Agreement.




     “Regulatory Change”: As to any Bank, the introduction of, or any change in any
applicable law, treaty, rule, regulation or guideline or in the interpretation or
administration thereof by any governmental authority or any central bank or other fiscal,
monetary or other authority having jurisdiction over the Banks or their lending offices.




     “Required Banks”: Banks having Pro Rata Shares aggregating fifty one percent
(51%) or more.




     “State”: The state in which the Property is located.




     “Title Company”: Liberty Title Insurance Company.



ARTICLE 2




REPRESENTATIONS AND WARRANTIES




     2.1 Representations and Warranties. To induce the Banks to execute and perform this
Agreement, Borrower hereby represents, covenants or warrants to the Banks as follows:




     (a) At the Loan Closing and at all times thereafter until the Loans are paid in full,
Borrower will have good and merchantable fee simple title to the Property, with the
exception of the Property located at 56805 Van Dyke Avenue, Shelby Township, MI, with
respect to which the Borrower is the ground lessee under a Ground Lease dated August 17,
2007, subject only to the Permitted Exceptions;




     (b) Borrower is a limited partnership, duly organized, validly existing and in good
standing under the laws of the State of Delaware and is qualified to conduct business in the
State of Michigan. Borrower has full power and authority to conduct its business as
presently conducted, to own and operate the Property, to enter into this Agreement and to
perform all of its duties and obligations under this Agreement and under the Loan Documents;
such execution and performance have been duly authorized by all necessary Legal
Requirements; neither Borrower nor Guarantor has been convicted of a felony and there are no
proceedings or investigations being conducted involving criminal activities of either
Borrower or Guarantor;




     (c) This Agreement, the Note, the Mortgages, the other Loan Documents and any other
documents and instruments required to be executed and delivered by Borrower and/or Guarantor
in connection with the Loans, when executed and delivered, will constitute the duly
authorized, valid and legally binding obligations of the party required to execute the same
and will be enforceable strictly in accordance with their respective terms (except to the
extent that enforceability may be affected or limited by applicable bankruptcy, insolvency
and other similar debtor relief laws affecting the enforcement of creditors’ rights
generally); no basis presently exists for any claim against Agent or the Banks under this
Agreement, under the Loan Documents or with respect to the Loans; enforcement of this
Agreement and the Loan Documents are subject to no defenses of any kind;




     (d) The execution, delivery and performance of this Agreement, the Note, the Mortgages,
the other Loan Documents and any other documents or instruments to be executed and delivered
by Borrower or Guarantor pursuant to this Agreement or in connection with the



7









 






Loans and occupancy and use of the Property will not, to the Borrower’s Actual
Knowledge: (i) violate any Legal Requirements, or (ii) conflict with, be inconsistent with,
or result in any breach or default of any of the terms, covenants, conditions or provisions
of any indenture, mortgage, deed of trust, instrument, document, agreement or contract of
any kind to which Borrower or Guarantor is a party or by which any of them may be bound.
Neither Borrower nor Guarantor is in default (without regard to grace or cure periods) under
any contract or agreement to which it is a party, the effect of which default will adversely
affect the performance by Borrower or Guarantor of its obligations pursuant to and as
contemplated by the terms and provisions of this Agreement and/or the other Loan Documents;




     (e) No condition, circumstance, event, agreement, document, instrument, restriction,
litigation or proceeding (or threatened litigation or proceeding or basis therefor) exists
which could (i) adversely affect the validity or priority of the liens and security
interests granted Agent under the Loan Documents; (ii)  materially adversely affect the
ability of Borrower or Guarantor to perform their obligations under the Loan Documents; or
(iii) constitute an Event of Default under any of the Loan Documents or an event which, with
the giving of notice, the passage of time or both, would constitute such an Event of
Default;




     (f) To the Borrower’s Actual Knowledge, the Property, and the present use and occupancy
of the Property, will not violate or conflict with any applicable law, statute, ordinance,
rule, regulation or order of any kind, including, without limitation, Environmental Laws,
zoning, building, land use, noise abatement, occupational health and safety or other laws,
any building permit or any condition, grant, easement, covenant, condition or restriction,
whether recorded or not, and if a third-party is required under any covenants, conditions
and restrictions of record or any other agreement to consent to the use and/or operation of
the Property, Borrower has obtained such approval from such party. In addition, and without
limiting the foregoing, Borrower shall (a) ensure that no person or entity which owns a
controlling interest in or otherwise controls Borrower is or shall be listed on the
Specially Designated Nationals and Blocked Person List or other similar lists maintained by
the Office of Foreign Assets Control (“OFAC”), the Department of the Treasury or
included in any Executive Orders, (b) not use or permit the use of any Loan Proceeds to
violate any of the foreign asset control regulations of OFAC or any enabling statute or
Executive Order relating thereto, and (c) comply with all applicable Bank Secrecy Act laws
and regulations, as amended;




     (g) The Property has never been used, and the Property will not be used, for any
activities which, directly or indirectly, involve the use, generation, treatment, storage,
transportation or disposal of any Hazardous Materials in violation of any Environmental
Laws. No Hazardous Materials exist now, and no Hazardous Materials will hereafter exist, on
or under the Property in violation of any Environmental Laws or in any surface waters or
groundwaters on or under the Property. The Property and its existing and prior uses have at
all times complied with and will comply with all Environmental Laws, and Borrower has not
violated, and will not violate, any Environmental Laws;




     (h) There are no facilities on the Property which are subject to reporting under any
State laws or Section 312 of the Federal Emergency Planning and Community Right-to-Know Act
of 1986 (42 U.S.C. Section 11022), and federal regulations promulgated thereunder. The
Property does not contain any underground storage tanks;




     (i) All financial statements submitted by Borrower or Guarantor to Agent in connection
with the Loans are true and correct in all material respects, have been prepared in
accordance with generally accepted accounting principles consistently applied, and fairly
present



8









 






the respective financial conditions and results of operations of the entities which are
their subjects;




     (j) This Agreement and all financial statements, budgets, schedules, opinions,
certificates, confirmations, applications, rent rolls, affidavits, agreements, and other
materials submitted to Agent in connection with or in furtherance of this Agreement by or on
behalf of Borrower or Guarantor fully and fairly state the matters with which they purport
to deal, and neither misstate any material fact nor, separately or in the aggregate, fail to
state any material fact necessary to make the statements made not misleading;




     (k) All governmental permits and licenses required by applicable law to occupy and
operate the Property have been validly issued and are in full force;




     (l) Improvements on the Property do not encroach upon any building line, set back line,
sideyard line, or any recorded or visible easement (or other easement of which Borrower is
aware or has reason to believe may exist) which exists with respect to the Property;




     (m) The Loans, including interest rate, fees and charges as contemplated hereby, are
business loans; the Loans are an exempted transaction under the Truth In Lending Act, 12
U.S.C. § 1601 et seq.; and the Loans do not, and when disbursed will not, violate the
provisions of the usury laws of the State, any consumer credit laws or the usury laws of any
state which may have jurisdiction over this transaction, Borrower or any property securing
the Loans;




     (n) There are no Leases for use or occupancy of any part of the Property other than as
previously delivered to and approved by Agent; Borrower shall not enter into any other Lease
for all or any portion of the Property, without the prior written consent of Agent; and




     (o) The Leases are in full force and effect; to the Borrower’s Actual Knowledge, no
defaults have occurred thereunder; no tenant under any Lease has a current right of set-off
against payment of rent due thereunder; and, to the Borrower’s Actual Knowledge, no events
or circumstances exist which, with the passage of time or the giving of notice, or both,
would constitute a default under a Lease.



     2.2 Continuation of Representations and Warranties. The Borrower hereby covenants,
warrants and agrees that the representations and warranties made in Section 2.1 hereof shall be and
shall remain true and correct at the time of the Loan Closing.



ARTICLE 3




AMOUNT AND TERMS OF LOANS




     3.1 Agreement to Lend and to Borrow; Notes.




     (a) Subject to the conditions and upon the terms provided for in this Agreement, each
Bank severally agrees to make the Loans to Borrower in the principal amount indicated on
Schedule 3.1 hereto. The Loans shall be LIBOR Loans except in the circumstances described
in Section 4.4(b), 4.6 or 4.8.




     (b) The Loans made by each Bank shall be evidenced by a Note of Borrower, substantially
in the form of Exhibit “B” hereto, with appropriate insertions therein as to payee,
date and principal amount, payable to the order of such Bank. The date, amount and type of
each



9









 






Loan and payment or prepayment of principal with respect thereto, each continuation
thereof, and the length of each Interest Period with respect to each LIBOR Loan shall be
recorded by each Bank on its books and, (prior to any transfer of its Note or, at the
discretion of each Bank, at any other time) endorsed by each Bank, on the schedules annexed
to and constituting a part of its Note. Each such recordation shall constitute prima facie
evidence of the accuracy of the information so recorded in the absence of manifest error.
The Note of each Bank shall (i) be dated the date hereof or, if a Bank’s interest is
hereafter assigned, the effective date of such assignment, (ii) be stated to mature on the
Maturity Date, and (iii) provide for the payment of princial and interest in accordance with
Article 4 hereof.




     (c) No portion of any Loan shall be funded with plan assets of (i) any employee benefit
plan subject to Title I of ERISA, (ii) any plan covered by Section 4975 of the Code, or
(iii) any government plan subject to state laws that are comparable to Title I of ERISA or
Section 4975 of the Code.



     3.2 Commitments Several. The failure of any Bank to make its Loan at the Loan Closing
shall not relieve any other Bank of its obligation (if any) to make a Loan on such date, but no
Bank shall be responsible for the failure of any other Bank to make any Loan to be made by such
other Bank.



ARTICLE 4




PRINCIPAL, INTEREST; SPECIAL PROVISIONS FOR LIBOR LOANS




     4.1 Interest Rates. Borrower promises to pay interest on the unpaid principal amount
of each Loan for the period commencing on the date of such Loan until such Loan is paid in full as
follows:




     (a) at all times while such Loan is a LIBOR Loan, at a rate per annum equal to the sum
of the LIBOR Rate (Reserve Adjusted) applicable to each Interest Period for such Loan
plus the Applicable Margin from time to time in effect; and




     (b) at all times while such Loan is a Base Rate Loan, at a rate per annum equal to the
sum of the Base Rate from time to time in effect minus the Applicable Margin from
time to time in effect. Loans may be Base Rate Loans only under the circumstances described
in Section 4.4(b), 4.6 or 4.8;


provided that at any time an Event of Default exists, the interest rate applicable to each Loan
shall be increased by two percent (2.00%) (the “Default Rate”).




     4.2 Payment of Principal and Interest.




     (a) Principal and interest on the Loans shall be payable as provided in the Notes. The
outstanding principal balance on all Loans made by the Banks hereunder shall be due and
payable in full on the Maturity Date, unless the Loans are otherwise accelerated, terminated
or extended as provided in this Agreement.




     (b) Borrower shall be entitled to exercise a one-time option to extend the Maturity
Date for a period of two years from the initial Maturity Date, provided that: (1) as of the
initial Maturity Date, the Property shall have generated a Debt Service Coverage Ratio, as
of the end of the most recent fiscal year, of not less than 1.20 to 1.00, and (2) the
Borrower shall pay to the Agent an extension fee in an amount equal to one eighth of one
percent (1/8%) of the principal balance outstanding on the Loans as of the initial Maturity
Date. In the event the Borrower



10









 






exercises this extension option, the payment schedules attached to the Notes shall be
revise to add the additional principal payments that will be required to continue amortizing
the outstanding principal balance of the Loans as of the initial Maturity Date over the
remainder or the original amortization period.




     (c) Prior to the occurrence of an Event of Default, all payments and prepayments on
account of the indebtedness evidenced by the Note shall be applied as follows: (i) first, to
fees, expenses, costs and other similar amounts then due and payable to the Banks,
(ii) second, to accrued and unpaid interest on the principal balance of the Note,
(iii) third, to the payment of principal due in the month in which the payment or prepayment
is made, if any, (iv) fourth, to any escrows, impounds or other amounts which may then be
due and payable under the Loan Documents, (v) fifth, to any other amounts then due the Banks
hereunder or under any of the Loan Documents, and (vi) last, to the unpaid principal balance
of the Note. After an Event of Default has occurred and is continuing, payments shall be
applied as required under applicable law and in the absence of any such requirements,
payments may be applied to amounts owed hereunder and under the Loan Documents in such order
as Agent shall determine, in its sole discretion.




     (d) All payments of principal (including prepayments) and accrued interest shall be
paid by wire transfer or check in United States Dollars, to Agent, for the account of the
Banks, at such place as Agent may from time to time direct, and in the absence of such
direction, then at the offices of Agent at 2600 West Big Beaver Road, Troy, Michigan 48084.
Payment made by check shall be deemed paid on the date Lender receives such check; provided,
however, that if such check is subsequently returned to Agent unpaid due to insufficient
funds or otherwise, the payment shall not be deemed to have been made and shall continue to
bear interest until collected. Notwithstanding the foregoing, the final payment due under
the Note must be made by wire transfer or other immediately available funds.




     (e) If any payment of interest or principal due hereunder is not made within five days
after such payment is due in accordance with the terms hereof, then, in addition to the
payment of the amount so due, Borrower shall pay to Agent a “late charge” of five cents for
each whole dollar so overdue to defray part of the cost of collection and handling such late
payment. Borrower agrees that the damages to be sustained by the holder hereof for the
detriment caused by any late payment are extremely difficult and impractical to ascertain,
and that the amount of five cents for each one dollar due is a reasonable estimate of such
damages, does not constitute interest, and is not a penalty.




     (f) LIBOR Loans and Base Rate Loans may be prepaid either in whole or in part at any
time and from time to time without penalty or premium upon three (3) days prior notice to
Agent; provided, however, that if a LIBOR Loan is prepaid on a date other than the last day
of the applicable Interest Period, it shall be accompanied by any amounts due under
Section 4.11 hereof.



     4.3 Types of Loans; Setting and Notice of LIBOR Rates.




     (a) Each Loan shall be divided into tranches which shall be LIBOR Loans, except in the
circumstances described in Section 4.4(b), 4.6 or 4.8, in which case they shall be Base Rate
Loans (each a “type” of Loan). Not more than five (5) different tranches of LIBOR Loans
shall be outstanding at any one time. All borrowings, conversions and repayments of Loans
shall be effected so that each Bank will have a pro rata share (according to its Pro Rata
Share) of all Loans. Each LIBOR Loan shall be designated by the Borrower by any written,
verbal, electronic, telephonic or telecopy request, in form acceptable to the Agent, which
the Agent in good faith



11









 






believes to emanate from a properly authorized representative of the Borrower, whether
or not that is in fact the case. Each such request shall be effective upon receipt by the
Agent, shall be irrevocable, and shall specify the date, amount and the initial Interest
Period therefor. Upon receipt of any such notice, Agent shall promptly notify each Bank
thereof. The final Interest Period for any LIBOR Loan must be such that its expiration
occurs on or before the Maturity Date. A request to designate a LIBOR Loan must be (i)
received by the Agent no later than 11:00 a.m. Troy, Michigan time, three days before the
day it is to be designated a LIBOR Loan, and (ii) in an amount equal to Five Hundred
Thousand and 00/100 Dollars ($500,000.00) or a higher integral multiple of Two Hundred Fifty
Thousand and 00/100 Dollars ($250,000.00). The Borrower does hereby irrevocably confirm,
ratify and approve all such designations and does hereby indemnify the Agent and the Banks
against losses and expenses (including court costs, attorneys’ and paralegals’ fees) and
shall hold the Agent and the Banks harmless with respect thereto.




     (b) The applicable LIBOR Rate for each Interest Period shall be determined by the
Agent, and notice thereof shall be given by the Agent promptly to Borrower and each Bank.
The Agent shall, upon written request of Borrower or any Bank, deliver to Borrower or such
Bank a statement showing the computations used by the Agent in determining any applicable
LIBOR Rate hereunder.



     4.4 Conversion and Continuation Procedures.




     (a) Each LIBOR Loan shall automatically renew for the Interest Period specified in the
initial request received by the Bank for the LIBOR Loan, at the then current LIBOR Rate
unless the Borrower, pursuant to a subsequent written notice received by the Agent, shall
elect a different Interest Period. Upon receipt by the Agent of such subsequent notice, the
Borrower may, subject to the terms and conditions of this Agreement, elect, as of the last
day of the applicable Interest Period, to continue any LIBOR Loan having an Interest Period
expiring on such day for a different Interest Period. Such notice shall be given before
11:00 a.m., Troy, Michigan time, at least three Business Days prior to the last day of the
applicable Interest Period, specifying: (i) the aggregate amount of LIBOR Loans to be
converted to a different Interest Period; and (ii) the duration of the requested Interest
Period.




     (b) The Borrower may not elect an Interest Period, and an Interest Period for a LIBOR
Loan shall not automatically renew, with respect to any principal amount which is scheduled
to be repaid before the last day of the applicable Interest Period, and any such amounts
shall be converted to Base Rate Loans until repaid.



     4.5 Computation of Interest and Fees.




     (a) Fees and interest shall be calculated on the basis of a 365 day year (366 days for
leap years) for the actual days elapsed in any portion of a month in which interest is due.
Interest on Base Rate Loans and LIBOR Loans shall not exceed the maximum amount permitted
under applicable law. Any change in the interest rate on a Loan resulting from a change in
the Base Rate, or the Eurocurrency Reserve Percentage, shall become effective as of the
opening of business on the day on which such change becomes effective. Agent shall as soon
as practicable notify Borrower and the Banks of each determination of a LIBOR Rate.




     (b) Each determination of an interest rate by Agent pursuant to any provision of this
Agreement shall be conclusive and binding upon the parties hereto in the absence of manifest
error.



12









 





     4.6 Inability to Determine Interest Rate. If prior to the first day of any Interest
Period, Agent shall have determined (which determination shall be conclusive, absent manifest
error) that (i) the making or maintenance of any LIBOR Loan would violate any applicable law, rule,
regulation or directive, whether or not having the force of law, (ii) United States dollar deposits
in the principal amount, and for periods equal to the Interest Period for funding any LIBOR Loan
are not available in the London Interbank Eurodollar market in the ordinary course of business, or
(iii) by reason of circumstances affecting the London Interbank Eurodollar market, adequate and
fair means do not exist for ascertaining the LIBOR Rate to be applicable to the relevant LIBOR
Loan, Agent shall give telecopy or telephonic notice thereof to Borrower and Banks as soon as
practicable thereafter and, so long as such circumstances shall continue, (A) no Bank shall be
under any obligation to make any LIBOR Loans or convert any Base Rate Loans into LIBOR Loans, and
(B) on the last day of the current Interest Period for each LIBOR Loan, such Loan, unless then
repaid in full, shall automatically convert to a Base Rate Loan, without further demand,
presentment, protest or notice of any kind, all of which are hereby waived by the Borrower.



     4.7 Pro Rata Treatment and Payments. Each borrowing by Borrower from the Banks
hereunder, and each payment by Borrower on account of any fees hereunder, shall be made pro rata
according to the respective Pro Rata Shares of the Banks. Each payment (including each prepayment)
by Borrower on account of principal of and interest on the Loans shall be made pro rata according
to the respective outstanding principal amounts of the Loans then held by the Banks. All payments
(including prepayments) to be made by Borrower hereunder and under the Notes, whether on account of
principal, interest, fees or otherwise, shall be made without setoff or counterclaim and shall be
made prior to 1:00 P.M., Troy, Michigan time, on the due date thereof. Agent shall distribute such
payments to the Banks promptly upon receipt in like funds as received. If any payment hereunder
becomes due and payable on a day other than a Business Day, such payment shall be extended to the
next succeeding Business Day, and, with respect to payments of principal, interest thereon shall be
payable at the then applicable rate during such extension.



     4.8 Illegality. Notwithstanding any other provision herein, if Agent shall have
reasonably determined that any Regulatory Change shall make it unlawful for any Bank to make or
maintain LIBOR Loans as contemplated by this Agreement, Agent shall give notice of such
determination to Borrower and each Bank and (A) the commitment of such Bank hereunder to make LIBOR
Loans, continue LIBOR Loans as such and convert Base Rate Loans to LIBOR Loans shall forthwith be
canceled and (B) the LIBOR Loans then outstanding, if any, shall be converted automatically to Base
Rate Loans on the respective last days of the then current Interest Periods with respect to such
LIBOR Loans or within such earlier period as required by law. If any such conversion of a LIBOR
Loan occurs on a day which is not the last day of the then current Interest Period with respect
thereto, Borrower shall pay to each Bank such amounts, if any, as may be required pursuant to
subSection 4.11.



     4.9 Legal Requirements.




     (a) If any Regulatory Change made subsequent to the date hereof shall:




     (i) subject any Bank to any tax of any kind whatsoever with respect to this
Agreement, any Note or any LIBOR Loan made by it, or change the basis of taxation
of payments to such Bank in respect thereof (except for Non-Excluded Taxes covered
by subsection 4.10 and changes in the rate of tax on the overall net income of such
Bank);




     (ii) impose, modify or hold applicable any reserve, special deposit,
compulsory loan or similar requirement against assets held by, deposits or other
liabilities in or for the account of, advances, loans or other extensions of credit
by, or



13









 






any other acquisition of funds by, any office of such Bank which is not
otherwise included in the determination of the LIBOR Rate; or




     (iii) impose on such Bank any other condition regarding the LIBOR Loans or any
Banks’ funding thereof;




and the result of any of the foregoing is to increase the cost to such Bank, by an amount
which such Bank in good faith deems to be material, of making, converting into, continuing
or maintaining LIBOR Loans or to reduce any amount receivable hereunder in respect thereof,
then, in any such case, Borrower shall promptly pay such Bank, upon its demand, any
additional amounts necessary to compensate such Bank for such increased cost or reduced
amount receivable.




     (b) If any Bank shall have determined that any Regulatory Change regarding capital
adequacy or in the interpretation or application thereof or compliance by such Bank or any
corporation controlling such Bank with any request or directive regarding capital adequacy
(whether or not having the force of law) from any Governmental Authority, in any such case
made subsequent to the date hereof, does or shall have the effect of reducing the rate of
return on such Bank’s or such corporation’s capital as a consequence of its obligations
hereunder to a level below that which such Bank or such corporation could have achieved but
for such change or compliance (taking into consideration such Bank’s or such corporation’s
policies with respect to capital adequacy) by an amount deemed by such Bank to be material,
then from time to time, after submission by such Bank to Borrower (with a copy to Agent) of
a written request therefor, Borrower shall pay to such Bank such additional amount or
amounts as will compensate such Bank for such reduction.




     (c) If any Bank becomes entitled to claim any additional amounts pursuant to this
subsection, it shall promptly notify Borrower, with a copy to Agent, of the event by reason
of which it has become so entitled. A certificate as to any additional amounts payable
pursuant to this subSection submitted by such Bank to Borrower (with a copy to Agent) shall
be conclusive in the absence of manifest error. This covenant shall survive the termination
of this Agreement and the payment of the Notes and all other amounts payable hereunder.




     (d) Notwithstanding anything to the contrary contained in this subsection, Borrower
shall not be required to pay any additional amounts to any Bank pursuant to this subSection
to the extent such additional amounts result from such Bank’s negligence.



     4.10 Taxes.




     (a) All payments made by Borrower under this Agreement and any Note shall be made free
and clear of, and without deduction or withholding for or on account of, any present or
future income, stamp or other taxes, levies, imposts, duties, charges, fees, deductions or
withholdings, now or hereafter imposed, levied, collected, withheld or assessed by any
Governmental Authority, excluding net income taxes and franchise taxes (imposed in lieu of
net income taxes) imposed on Agent or any Bank as a result of a present or former connection
between Agent or such Bank and the jurisdiction of the Governmental Authority imposing such
tax or any political subdivision or taxing authority thereof or therein (other than any such
connection arising solely from Agent or such Bank having executed, delivered or performed
its obligations or received a payment under, or enforced, this Agreement or any Notes). If
any such non-excluded taxes, levies, imposts, duties, charges, fees, deductions or
withholdings (“Non-Excluded Taxes”) are required to be withheld from any amounts
payable to Agent or any Bank



14









 






hereunder or under any Notes, the amounts so payable to Agent or such Bank shall be
increased to the extent necessary to yield to Agent or such Bank (after payment of all
Non-Excluded Taxes) interest or any such other amounts payable hereunder at the rates or in
the amounts specified in this Agreement, provided, however, that Borrower shall not be
required to increase any such amounts payable to any Bank that is not organized under the
laws of the United States of America or a state thereof if such Bank fails to comply with
the requirements of paragraph (b) of this subsection. Whenever any Non-Excluded Taxes are
payable by Borrower, as promptly as possible thereafter Borrower shall send to Agent for its
own account or for the account of such Bank, as the case may be, a certified copy of an
original official receipt received by Borrower showing payment thereof. If Borrower fails
to pay any Non-Excluded Taxes when due to the appropriate taxing authority or fails to remit
to Agent the required receipts or other required documentary evidence, Borrower shall
indemnify Agent and the Banks for any incremental taxes, interest or penalties that may
become payable by Agent or any Bank as a result of any such failures. The agreements in
this subSection shall survive the termination of this Agreement and the payment of the Notes
and all other amounts payable hereunder. Notwithstanding anything to the contrary contained
in this subsection, Borrower shall not be required to pay any additional amounts to any Bank
pursuant to this subSection to the extent such additional amounts result from such Bank’s
negligence.




     (b) Each Bank that is not incorporated under the laws of the United States of America
or a state thereof shall:




     (i) deliver to Borrower and Agent (A) two duly completed copies of United
States Internal Revenue Service Form 1001 or 4224, or successor applicable form, as
the case may be, and (B) an Internal Revenue Service Form W-8 or W-9, or successor
applicable form, as the case may be;




     (ii) deliver to Borrower and Agent two further copies of any such form or
certification on or before the date that any such form or certification expires or
becomes obsolete and after the occurrence of any event requiring a change in the
most recent form previously delivered by it to Borrower; and




     (iii) obtain such extensions of time for filing and complete such forms or
certifications as may reasonably be requested by Borrower or Agent; unless in any
such case an event (including, without limitation, any change in treaty, law or
regulation) has occurred prior to the date on which any such delivery would
otherwise by required which renders all such forms inapplicable or which would
prevent such Bank from duly completing and delivering any such form with respect to
it and such Bank so advises Borrower and Agent. Such Bank shall certify (i) in the
case of a Form 1001 or 4224, that it is entitled to receive payments under this
Agreement without deduction or withholding of any United States federal income
taxes and (ii) in the case of a Form W-8 or W-9, that it is entitled to an
exemption from United States backup withholding tax. Each party that shall become
a transferee pursuant to Section 10.1 shall, upon the effectiveness of the related
transfer, be required to provide all of the forms and statements required pursuant
to this Section, provided that in the case of a participant such participant shall
furnish all such required forms and statements to Bank from which the related
participation shall have been purchased.



     4.11 LIBOR Loan Indemnification. Borrower agrees to indemnify each Bank and to hold
each Bank harmless from any loss or expense which such Bank may sustain or incur as a consequence
of (a) default by Borrower in making a borrowing of, conversion into or continuation of LIBOR Loans
after



15









 




Borrower has given a notice requesting the same in accordance with the provisions of this
Agreement, (b) default by Borrower in making any prepayment after Borrower has given a notice
thereof in accordance with the provisions of this Agreement, or (c) the making of a prepayment of
LIBOR Loans on a day which is not the last day of an Interest Period with respect thereto. Such
indemnified amount shall include any and all costs, expenses, penalties and charges incurred by the
Banks as a result thereof, plus an amount equal to the excess, if any, of (i) the amount of
interest which would have accrued on the amount so prepaid, or borrowed, converted or continued,
for the period from the time of such prepayment or of such failure to borrow, convert or continue
to the last day of such Interest Period (or, in the case of the failure to borrow, convert or
continue, the Interest Period which would have commenced on the date of such failure) in each case
the applicable rate of interest for such Loans provided herein (excluding, however, the Applicable
Margin included thereon, if any) over (ii) the amount of interest (as reasonably defined by such
Bank) which would have accrued to such Bank on such amount by placing such amount on deposit for a
comparable period with leading banks in the certificate of deposit market, the eurodollar deposit
market, or other appropriate money market selected by such Bank. This covenant shall survive the
termination of this Agreement and the payment of the Notes and all other amounts due hereunder.
Amounts payable pursuant to this subSection shall be paid to Agent for the account of the
applicable Bank, upon the request of such Bank through Agent and a determination of any Bank as to
the amounts payable pursuant to this subSection shall be conclusive absent manifest error, based
upon the assumption that such Bank funded its loan commitment for LIBOR Loans in the London
Interbank Eurodollar market and using any reasonable attribution or averaging methods which such
Bank deems appropriate and practical, provided, however, that such Bank is not obligated to accept
a deposit in the London Interbank Eurodollar market in order to charge interest on a LIBOR Loan at
the LIBOR Rate.




ARTICLE 5




LOAN DOCUMENTS




     5.1 Loan Documents. As a condition precedent to the Loan Closing, Borrower agrees
that it will deliver the following Loan Documents to Agent at least five (5) days prior to the Loan
Closing, all of which must be satisfactory to Agent and Agent’s counsel in form, substance and
execution:




     (a) Promissory Notes. Promissory notes dated the date hereof executed by
Borrower and made payable to the order of each Bank in the amount of its respective Loan in
the form of Exhibit “B” attached hereto.




     (b) Mortgages. Mortgages dated as of even date herewith (the
“Mortgages”), duly executed by Borrower to and for the benefit of Agent, granting a
first lien on the Property to Agent for the benefit of the Banks, to secure the Notes, the
Loan and all obligations of Borrower in connection therewith and any and all indebtedness,
liabilities and obligations owing from the Borrower to the Banks, or any of them, arising
under any interest rate, currency or commodity swap agreement(s), cap agreement(s) or collar
agreement(s), and any other agreement(s) or arrangement(s) entered into by the Borrower in
conjunction with the Loan and designed to protect the Borrower against fluctuations in
interest rates, currency exchange rates or commodity prices.




     (c) Assignment of Rents and Leases. Assignments of Rents and Leases dated as
of even date herewith (the “Assignments of Rents”), duly executed by Borrower to and
for the benefit of Agent, collaterally assigning to Agent for the benefit of the Banks all
of Borrower’s rents, leases and profits of the Property as security for the Notes, and, if
Agent so requires, specific collateral assignments of any particular Leases bearing the
consent to the assignment of the lessee whose Lease is so assigned.



16









 






     (d) Financing Statements. Uniform Commercial Code Financing Statements as
required by Agent to perfect all security interests granted by the Mortgages.




     (e) Environmental Indemnity. Environmental Indemnity Agreements dated as of
even date herewith (the “Environmental Indemnity”), jointly and severally executed
by Borrower and Guarantor to and for the benefit of Agent, on behalf of the Banks, whereby
Borrower and Guarantor jointly and severally indemnify the Banks for any loss, cost, damage
or expense incurred as a result of environmental matters at the Property.




     (f) Guaranty. A Guaranty of Payment (the “Guaranty”), jointly and
severally executed by Guarantor to and for the benefit of Agent, guaranteeing to Agent, on
behalf of the Banks, payment of all amounts due in connection with the Loan.




     (g) Other Loan Documents. Such other documents and instruments as further
security for the Loan as Agent may reasonably require.



ARTICLE 6




CONDITIONS TO LOAN CLOSING




     6.1 Conditions to Loan Closing. As a condition precedent to the Loan Closing,
Borrower shall furnish the following to Agent at least five (5) days prior to the Loan Closing or
at such time as is set forth below, all of which must be strictly satisfactory to Agent and Agent’s
counsel in form, content and execution:




     (a) Title Insurance Policy. At the Loan Closing, an ALTA Loan Policy-1997
issued on the date of the Loan Closing by the Title Company to Agent in the full amount of
the Loan, insuring the Mortgages to be valid first, prior and paramount liens upon the fee
title (or leasehold interest in the case of the Property located at 56805 Van Dyke Avenue,
Shelby Township, MI) to the Property subject only to the Permitted Exceptions (the
“Title Insurance Policy”). The Title Insurance Policy must contain the following
endorsements: (i) ALTA Zoning Endorsement Form 3.1 (including compliance with parking
requirements); (ii) Comprehensive Endorsement; (iii) location endorsement; (iv) access
endorsement; (v) if a Property consists of more than one subparcel, contiguity endorsement;
(vi) environmental lien endorsement; (vii) creditor’s rights endorsement; (viii) variable
rate endorsements, if applicable; and (ix) such other endorsements as Agent may require. If
required by any Bank, Borrower shall procure reinsurance with companies and in amounts
satisfactory to the Banks.




     (b) Survey. A survey (the “Survey”) of the Property made by a land
surveyor licensed in the State, which Survey must be satisfactory to the Agent, showing:




     (i) the location of all buildings, driveways, parking areas, number of parking
spaces, fences and other improvements on the Property;




     (ii) the location (and recording information, to the extent recorded) of all
visible or recorded easements (including appurtenant easements), water courses,
drains, sewers, public and private roads (including the names and widths thereof
and recording numbers for the dedications thereof), other rights of way, and curb
cuts, if any, within, adjacent to or serving the Property or to which the Property
is subject; that the same are unobstructed; and that all portions of the Property
have direct access to dedicated public roads;



17









 






     (iii) the location of the servient estate of any easements, if the Property is
the dominant estate thereunder;




     (iv) the common street address of the Property and the dimensions, boundaries
and acreage or square footage of the Property;




     (v) that there are no encroachments onto the Property from improvements
located on adjoining property;




     (vi) the location and course of all utility lines;




     (vii) if the Property comprises more than one parcel, interior lines and other
data sufficient to insure contiguity; and




     (viii) such additional information which may be required by Agent or the Title
Company.




The Survey shall be made in accordance with (i) the current survey standards of the American
Land Title Association and American Congress on Surveying and Mapping and (ii) the laws of
the State. To the extent that there is any conflict or inconsistency among the Survey
standards described above, the more restrictive standard shall apply. The Survey shall be
dated not later than sixty (60) days prior to the Loan Closing, and shall bear a proper
certificate by the surveyor, which certificate shall recite compliance with the laws and
standards enumerated above, shall include the legal description of the Property and shall
run in favor of Borrower, Agent and the Title Company.




     (c) Insurance Policies. Borrower shall, during the term of this Agreement,
procure at its expense and keep in force the insurance coverages required by the Mortgages.
In addition, all insurance shall be in form, content and amounts approved by Agent and
written by an insurance company or companies licensed to do business in the state in which
the Property is located and domiciled in the United States or a governmental agency or
instrumentality approved by Agent. The policies for such insurance shall have attached
thereto standard mortgagee clauses in favor of and permitting Agent to collect any and all
proceeds payable thereunder and shall include a thirty (30) day (except for nonpayment of
premium, in which case, a ten (10) day) notice of cancellation clause in favor of Agent.
Duplicate policies or certificates of insurance shall be delivered to and held by Agent as
further security for the payment of the Note and any other obligations arising under the
Loan Documents, with evidence of renewal coverage delivered to Agent at least thirty (30)
days before the expiration date of any policy. In lieu of the foregoing requirements, such
insurance may be provided through self-insurance programs maintained by tenants under the
Leases, if so provided in the Leases, in which case Agent shall be listed as the lender loss
payee or an additional insured as its interest may apply.




     (d) Environmental Report. A written report (the “Environmental
Report”) prepared at Borrower’s sole cost and expense by an independent professional
environmental consultant approved by Agent in its sole and absolute discretion. The
Environmental Report shall be subject to the Banks’ approval in their sole and absolute
discretion. If the Environmental Report reveals contamination or conditions warranting
further investigation in order to establish baseline data, the Banks may require, in their
sole and absolute discretion, a written report (also referred to herein as the
“Environmental Report”) based on additional testing and investigation in order to
define the source and extent of the contamination or to establish baseline data, as well as
to provide relevant detailed information on the area’s geological and hydrogeological
conditions.



18









 






Any additional Environmental Report prepared pursuant to this requirement shall be
subject to the Banks’ approval, in their sole and absolute discretion.




     (e) Appraisals. Appraisals addressed and satisfactory to the Agent, prepared
by a certified or licensed appraiser who is approved by Agent. The appraisals must show
appraised values of the Property such that the ratio of the Loan Amount to the total of the
appraised values of the Property shall be no more than eighty percent (80.00%).




     (f) Documents of Record. Copies of all covenants, conditions, restrictions,
easements and matters of record which affect the Property.




     (g) Searches. A report from the appropriate filing officers of the state and
county in which the Property is located, indicating that no judgments, tax or other liens,
security interests, leases of personalty, financing statements or other encumbrances (other
than Permitted Exceptions and liens and security interests in favor of Agent) are of record
or on file encumbering any portion of the Property, and that there are no judgments, tax
liens, pending litigation or bankruptcy actions outstanding with respect to Borrower and the
Guarantor.




     (h) Borrower’s Attorney’s Opinion. An opinion of Borrower’s counsel addressing
such issues as Agent may request, including the following propositions and questions of law
that:




     (i) Borrower, its manager or general partner, as applicable, and, if Guarantor
is not an individual, Guarantor are duly organized, validly existing and in good
standing to do business in the state of their respective organization and in the
State;




     (ii) Borrower has all necessary legal right, power and authority to conduct
its business, to operate and use the Property and to enter into and perform its
obligations under this Agreement and the Loan Documents;




     (iii) all necessary corporate, shareholder, membership, partnership approvals,
resolutions and directions have been obtained for the operation and use of the
Property and the execution of this Agreement and the Loan Documents;




     (iv) the execution and delivery of this Agreement and the Loan Documents, the
performance thereunder by Borrower will comply with all applicable law and will not
violate or conflict with the instruments under which Borrower is organized or any
applicable contracts or agreements; and




     (v) the Loan Documents and this Agreement have been duly and validly executed
and delivered.




     (i) Organizational Documents. If Borrower is a partnership (and if any general
partner of Borrower is a partnership), a copy of the partnership agreement creating Borrower
(and such general partner) certified by a general partner of such partnership as being a
true and correct copy and as otherwise unmodified and in full force and effect, together
with a notarized incumbency certificate showing specimen signatures for all partners of
Borrower executing any Loan Documents. In addition, if Borrower is a limited partnership
(or if any general partner of Borrower is a limited partnership), a certified copy of the
certificate of limited partnership (and amendments thereto) of such partnership. If
Borrower is a corporation (or if any general partner of Borrower is a corporation), a
current Certificate of Good Standing for Borrower (or that partner) from the state of
incorporation and from the State, a certified copy of the Articles of



19









 






Incorporation and Bylaws, including all amendments thereto, for Borrower (or that
partner) and a notarized incumbency certificate showing specimen signatures for all officers
of Borrower (or that partner) executing any Loan Documents, and certified copies of director
and shareholder resolutions authorizing execution and delivery of the Loan Documents. If
Borrower is a limited liability company (or if any manager or general partner of Borrower is
a limited liability company), a copy of the operating agreement creating Borrower (or such
manager or partner), certified by the manager or the controlling member of such entity as
being a true and correct copy and as otherwise unmodified and in full force and effect,
together with a current Certificate of Good Standing for Borrower (and its manager or
general partner) from the state of incorporation and the State, a certified copy of the
Articles of Organization, including all amendments thereto, for Borrower (and its manager or
general partner), a certificate from the manager or controlling member providing that no
certificate of dissolution has been filed, a notarized incumbency certificate showing
specimen signatures for all of the members of Borrower (and its manager or general partner)
executing any Loan Documents and, if necessary, certified copies of resolutions from the
members authorizing execution and delivery of the Loan Documents. Borrower shall also
provide the appropriate organizational documents for Guarantor that is not an individual,
together with proper authorizing resolutions, if applicable.




     (j) Leases. Certified copies of all Leases and such evidence as to the
validity thereof, absence of defaults thereunder, good standing and financial ability of the
parties thereto to perform, and such subordination, non-disturbance and attornment
agreements and estoppel letters from tenants under Leases and holders of concessions or
encumbrances with respect to any portion of the Property, all as Agent may require. In
addition, Borrower shall deposit all security deposits required under Leases with Agent in
an account in Borrower’s name, which account is pledged to Agent pursuant to the Assignment
of Rents and Leases of even date herewith; provided, however, that such security deposits
may only be applied in accordance with the terms and conditions of the Leases.




     (k) Real Estate Taxes. Evidence satisfactory to Agent that the Property is
separately assessed for real estate taxing purposes.




     (l) Broker. Evidence satisfactory to Agent that all brokers’ commissions or
fees due with respect to the Loan or the Property have been paid in full in cash.




     (m) Additional Documents. Such other papers and documents regarding Borrower
or the Property as Agent may require.



     6.2 Termination of Agreement. Borrower agrees that all conditions precedent to the
Loan Closing will be complied with on or prior to the Loan Closing Date. If all of the conditions
precedent to the Loan Closing hereunder shall not have been performed on or before the Loan Closing
Date, the Banks may, at their option at any time thereafter and prior to the Loan Closing,
terminate this Agreement and all of their obligations hereunder by giving a written notice of
termination from Agent to Borrower. In the event of such termination, Borrower shall pay all Loan
Expenses which have accrued or been charged as of the Loan Closing Date.



ARTICLE 7




DISBURSEMENTS




     7.1 Conditions Precedent to Disbursement of Loan Proceeds. The Loan Closing shall be
made at such time as all of the conditions and requirements of this Agreement required to be
performed



20









 




by Borrower or other parties prior to the Loan Closing have been satisfied or performed,
unless the same shall have been waived in writing by Agent; but in no event shall the Loan Closing
occur later than the Loan Closing Date. At the Loan Closing, the Banks shall disburse funds
necessary to pay any Loan Expenses then due, unless paid by Borrower. The Loan Proceeds shall not
be disbursed by the Banks to Borrower unless:





     (a) all conditions precedent to that disbursement under the Loan Documents have been
satisfied;




     (b) no Event of Default has occurred under this Agreement or under any Loan Document,
and no event, circumstance or condition has occurred or exists which, with the passage of
time or the giving of notice, would constitute a Event of Default under this Agreement or
under the Loan Documents;




     (c) no litigation or proceedings are pending or threatened (including proceedings under
Title 11 of the United States Code) against Borrower, Guarantor or the Property, which
litigation or proceeding is material; and




     (d) all representations and warranties made by Borrower to the Banks herein and
otherwise in connection with the Loans are accurate in all material respects.



     7.2 Advances by Banks.




     (a) If a Bank (a “Defaulting Bank”) defaults in making any advance or paying
any other sum due and payable by it hereunder, such sum together with interest thereon at
the interest rate applicable to such borrowing from the date such amount was due until
repaid (such sum and interest thereon as aforesaid referred to, collectively, as the
“Bank Default Obligation”) shall be payable by the Defaulting Bank (i) to any Bank
which elects, at its sole option (and with no obligation to do so), to fund the amount which
the Defaulting Bank failed to fund or (ii) to Agent or any other Bank which under the terms
of this Agreement is entitled to reimbursement from the Defaulting Bank for the amounts
advanced or expended. Notwithstanding any provision hereof to the contrary, until such time
as a Defaulting Bank has repaid the Bank Default Obligation in full, all amounts which would
otherwise be distributed to the Defaulting Bank shall instead be applied first to repay the
Bank Default Obligation (to be applied first to interest at the Federal Funds Rate and then
to principal) until the Bank Default Obligation has been repaid in full (whether by such
application or by cure by the Defaulting Bank), whereupon such Bank shall no longer be a
Defaulting Bank. Any interest collected from Borrower on account of principal advanced by
any Bank(s) on behalf of a Defaulting Bank shall be paid to the Bank(s) who made such
advance and shall be credited against the Defaulting Bank’s obligation to pay interest on
the amount advanced at the Federal Funds Rate. If no other Bank funds the amount which the
Defaulting Bank was obligated to fund, then a portion of the Defaulting Bank’s indebtedness
hereunder equal to the Bank Default Obligation shall be subordinated to the indebtedness of
Borrower to the Banks (other than the Defaulting Bank) and shall be repaid only after
payment in full of all other indebtedness hereunder. The provisions of this Section shall
apply and be effective regardless of whether an Event of Default occurs and is then
continuing, and notwithstanding (i) any other provision of this Agreement to the contrary or
(ii) any instruction of Borrower as to its desired application of payments. Additionally, a
Defaulting Bank’s right to vote on matters which are subject to the consent or approval of
the Required Banks (other than the Defaulting Bank) shall be suspended until it ceases to be
a Defaulting Bank, and during any such period in which a Defaulting Bank’s voting rights
have been suspended the Required Banks shall be the requisite percentage of all other
entities comprising the Banks. Agent shall be



21









 






entitled to (i) withhold or set off, and to apply to the payment of the Bank Default
Obligation any amounts to be paid to such Defaulting Bank under this Agreement, and
(ii) bring an action or suit against such Defaulting Bank in a court of competent
jurisdiction to recover the Bank Default Obligation and, to the extent such recovery would
not fully compensate Bank (other than the Defaulting Bank) for the Defaulting Bank’s breach
of this Agreement, to collect damages. In addition, the Defaulting Bank shall indemnify,
defend and hold Agent and each of the other Banks harmless from and against any and all
claims, actions, liabilities, damages, costs and expenses (including attorneys’ fees and
expenses), plus interest thereon at the Default Rate, for funds advanced by Agent or any
other Bank on account of the Defaulting Bank or any other damages such entities may sustain
by reason of the Defaulting Bank’s failure or refusal to abide by its obligations under this
Agreement. If a Bank becomes a Defaulting Bank, Borrower may find a replacement Bank and
require the Defaulting Bank to assign its interests to such replacement in accordance with
the terms of Section 10.1 of this Agreement provided that there shall be deducted from the
amount that would otherwise be paid to the Defaulting Bank an amount equal to the Bank
Default Obligation.




     (b) Borrower hereby authorizes each Bank to make an advance to Agent for payment of the
Commitment Fee and reimbursement of all charges, costs and expenses incurred by Agent in
connection with the Loan, including, but not limited to, (i) any points, loan fees, service
charges, commitment fees or other fees due to Agent in connection with the Loan; (ii) all
title examination, survey, escrow, filing, search, recording and registration fees and
charges; (iii) all documentary stamp and other taxes and charges imposed by law on the
issuance or recording of any of the Loan Documents; (iv) all appraisal fees; (v) all
reasonable fees and disbursements of legal counsel engaged by Agent in connection with the
origination, negotiation, document preparation, consummation and administration of the Loan
and all reasonable fees and disbursements of legal counsel engaged by the Agent in
connection with the enforcement of this Agreement or any of the Loan Documents, which shall
also include reasonable attorneys’ fees and time charges of attorneys who may be employees
of the Agent or any affiliate of the Agent; and (vi) any amounts required to be paid by
Borrower under this Agreement, the Mortgages or any Loan Document after the occurrence of an
Event of Default (all of which are herein referred to as “Loan Expenses”).



     7.3 Expenses and Advances Secured by Mortgages. Any and all advances or payments made
by the Banks hereunder, from time to time, and any amounts expended by Agent pursuant to this
Agreement and all other Loan Expenses, as and when advanced or incurred, shall be deemed to have
been disbursed as part of the Loan and be and become secured and guaranteed by the Loan Documents
to the same extent and effect as if the terms and provisions of this Agreement were set forth
therein, whether or not the aggregate of such indebtedness shall exceed the face amount of the
Note.



     7.4 Acquiescence not a Waiver. To the extent that Agent may have acquiesced (whether
intentionally or unintentionally) in the Borrower’s failure to comply with and satisfy any
condition precedent to the Loan Closing or to the disbursement of the Loan Proceeds, such
acquiescence shall not constitute a waiver by Agent of any condition precedent set forth in this
Agreement, and Agent at any time thereafter may require the Borrower to comply with and satisfy all
conditions and requirements of this Agreement.



     7.5 Agent’s Action for Agent’s Own Protection Only. The authority herein conferred
upon Agent and any action taken by Agent or its agents or employees will be taken by Agent and by
its agents or employees for their own protection and that of the Banks only, and neither Agent nor
its agents or employees shall be deemed to have assumed any responsibility to Borrower or Guarantor
or any other person or entity with respect to any such action herein authorized or taken by them.



22









 





ARTICLE 8




FURTHER AGREEMENTS OF BORROWER




     8.1 Furnishing Information. Borrower will:




     (a) Furnish to Agent: (i) annual audited consolidated financial statements of Borrower
and Guarantor prepared in accordance with GAAP within 120 days after the end of Borrower’s
and the Guarantor’s fiscal year prepared by a regional independent public accountants (which
accountant’s opinion shall be unqualified), satifactory to Agent; (ii) within 60 days after
the close of each quarterly accounting period in each fiscal year, the consolidated balance
sheet of Borrower and the Guarantor as of the end of such quarterly period and the related
consolidated statements of income, cash flow and retained earnings for such quarterly period
and for the elapsed portion of the fiscal year ended with the last day of such quarterly
period, each prepared in accordance with GAAP; (iii) quarterly operating statements
(prepared on a basis consistent with that used in the preparation of the GAAP consolidated
financial statements of Borrower and the Guarantor) for each Property showing the most
recently ended fiscal quarter and the fiscal year to date, and the Net Operating Income for
the most recently completed fiscal quarter and 12 month period, within 60 days of the end of
each fiscal quarter for the quarterly operating statements, and within 120 days of the end
of each fiscal year for the annual operating statements, and (iv) copies of all of
Borrower’s and the Guarantor’s quarterly and annual filings with the Securities and Exchange
Commission and all shareholder reports and letters to Borrower’s and the Guarantor’s
partners and shareholders and all other publicly released information promptly after their
filing or mailing;




     (b) Within 60 days after the end of each fiscal quarter, furnish Agent certified rent
rolls of all properties owned by the Borrower, as of the last day of such period in a form
reasonable satisfactory to Agent;




     (c) Promptly notify Agent and each Bank of any condition or event which constitutes (or
which, with the giving of notice or lapse of time, or both, would constitute) an Event of
Default, and of any material adverse change in the financial condition of Borrower or
Guarantor;




     (d) Maintain a standard and modern system of accounting in accordance with generally
accepted accounting principles, consistently applied;




     (e) Permit Agent or any of its agents or representatives to have access to and to
examine and copy and make abstracts from all books and records regarding the Property at any
time or times hereafter during business hours.



     8.2 Compliance with Covenants; Prohibition Against Additional Recordings. Borrower
will comply with all recorded covenants affecting the Property. Borrower will not record or permit
to be recorded any document, instrument, agreement or other writing against the Property without
the prior written consent of Agent.



     8.3 Property Accounts. Borrower will set up and maintain all operating accounts and
other accounts related to the Property with Agent and shall maintain monthly minimum balances
sufficient to cover demand deposit account activities.



     8.4 Distributions. Borrower shall not make any distributions to its members, partners
or shareholders, as the case may be, of any revenue received by or on behalf of Borrower from the



23









 




ownership and operation of the Property unless or until the Loan and all interest accrued
thereon, the Loan Expenses and other amounts due the Banks hereunder have been paid in full.




     8.5 Further Assurance. Borrower, on request of Agent, from time to time, will execute
and deliver such documents as may be necessary to perfect and maintain perfected as valid liens
upon the Property and the personal property located thereon, the liens granted to Agent pursuant to
this Agreement or any of the other loan Documents, and to fully consummate the transactions
contemplated by this Agreement.



ARTICLE 9




CASUALTIES AND CONDEMNATION




     9.1 Application of Insurance Proceeds and Condemnation Awards. The proceeds of any
insurance policies collected or claims as a result of any loss or damage to any portion of the
Property resulting from fire, vandalism, malicious mischief or any other casualty or physical harm
and any awards, judgments or claims resulting from the exercise of the power of condemnation or
eminent domain shall be applied as provided in the Mortgages. Borrower shall not settle and adjust
any claims under policies of insurance without Agent’s prior written consent, except as provided in
the Mortgages.



ARTICLE 10




ASSIGNMENTS, SALE AND ENCUMBRANCES




     10.1 Bank Assignments, Participations.




     (a) Assignments. Any Bank may, with the prior written consent of Agent, at any
time assign and delegate to one or more commercial banks or other financial institutions
(any such entity to which such an assignment and delegation is to be made being herein
called an “Assignee”) all or any fraction of such Bank’s Loans (which assignment and
delegation shall be of a constant, and not a varying, percentage of all the assigning Bank’s
Loans) in a minimum aggregate amount equal to the lesser of (i) the amount of the assigning
Bank’s Pro Rata Share of the Loans and (ii) Two Million and 00/100 Dollars ($2,000,000.00);
provided that Borrower and the Agent shall be entitled to continue to deal solely
and directly with such Bank in connection with the interests so assigned and delegated to an
Assignee until the date when all of the following conditions shall have been met:




     (i) five Business Days (or such lesser period of time as Agent and the
assigning Bank shall agree) shall have passed after written notice of such
assignment and delegation, together with payment instructions, addresses and
related information with respect to such Assignee, shall have been given to the
Borrower and Agent by such assigning Bank and the Assignee,




     (ii) the assigning Bank and the Assignee shall have executed and delivered to
Borrower and the Agent an assignment agreement substantially in the form of
Exhibit “D” (an “Assignment Agreement”), together with any
documents required to be delivered thereunder, which Assignment Agreement shall
have been accepted by Agent, and



24









 






     (iii) except in the case of an assignment by a Bank to one of its affiliates,
the assigning Bank or the Assignee shall have paid Agent a processing fee of Three
Thousand Five Hundred and 00/100 Dollars ($3,500.00).




From and after the date on which the conditions described above have been met, (A) such
Assignee shall be deemed automatically to have become a party hereto and, to the extent that
rights and obligations hereunder have been assigned and delegated to such Assignee pursuant
to such Assignment Agreement, shall have the rights and obligations of a Bank hereunder, and
(B) the assigning Bank, to the extent that rights and obligations hereunder have been
assigned and delegated by it pursuant to such Assignment Agreement, shall be released from
its obligations hereunder arising from and after the effective date of such assignment.
Within five Business Days after effectiveness of any assignment and delegation, Borrower
shall execute and deliver to Agent (for delivery to the Assignee and the Assignor, as
applicable) a new Note in the principal amount of the Assignee’s Pro Rata Share of the Loans
and, if the assigning Bank has retained a portion of the Loans, a replacement Note in the
principal amount of the Pro Rata Share of the Loans retained by the assigning Bank (such
Note to be in exchange for, but not in payment of, the predecessor Note held by such
assigning Bank). Each such Note shall be dated the effective date of such assignment. The
assigning Bank shall mark the predecessor Note “exchanged” and deliver it to Borrower.
Accrued interest on that part of the predecessor Note being assigned shall be paid as
provided in the Assignment Agreement. Accrued interest and fees on that part of the
predecessor Note not being assigned shall be paid to the assigning Bank. Accrued interest
and accrued fees shall be paid at the same time or times provided in the predecessor Note
and in this Agreement. Any attempted assignment and delegation not made in accordance with
this Section 10.1.(a) shall be null and void.




     (b) Participations. Any Bank may at any time sell to one or more commercial
banks or other financial institutions participating interests in any Loan owing to such
Bank, the Note held by such Bank, the Loans of such Bank, or any other interest of such Bank
hereunder (any Person purchasing any such participating interest being herein called a
“Participant”). In the event of a sale by a Bank of a participating interest to a
Participant, (i) such Bank shall remain the holder of its Note for all purposes of this
Agreement, (ii) Borrower and Agent shall continue to deal solely and directly with such Bank
in connection with such Bank’s rights and obligations hereunder, and (iii) all amounts
payable by Borrower shall be determined as if such Bank had not sold such participation and
shall be paid directly to such Bank. No Participant shall have any direct or indirect
voting rights hereunder and participants shall not have the right to further participate
their interests. Each Bank agrees to incorporate the requirements of the preceding sentence
into each participation agreement which such Bank enters into with any Participant.
Borrower agrees that if amounts outstanding under this Agreement and the Notes are due and
payable (as a result of acceleration or otherwise), each Participant shall be deemed to have
the right of setoff in respect of its participating interest in amounts owing under this
Agreement, any Note; provided that such right of setoff shall be subject to the
obligation of each Participant to share with the Banks, and the Banks agree to share with
each Participant, as provided herein. Borrower also agrees that each Participant shall be
entitled to the benefits of Article 4 hereof as if it were a Bank (provided that no
Participant shall receive any greater compensation pursuant to such Article 4 than would
have been paid to the participating Bank if no participation had been sold).



     10.2 Prohibition of Assignments and Encumbrances by Borrower. Except as expressly
provided in the Mortgages, Borrower, without the prior written consent of Agent, shall not create,
effect, consent to, attempt, contract for, agree to make, suffer or permit any Prohibited Transfer
(as defined in the Mortgages).




25











 





     10.3 Partial Releases of Property. The Borrower shall be entitled to a partial
release from the lien of a Mortgage of each Property upon payment of a principal payment on the
Loan, in addition to all scheduled payments of principal, in the amount shown for the applicable
Property in Schedule 10.1 attached. Any such principal payment shall be applied to the outstanding
principal balance of the Loans, on a pro-rata basis, and, at Borrower’s request, the amount of the
regularly scheduled payments of principal due thereafter shall be adjusted to the amount necessary
to amortize the remaining principal balance over the remainder of the original amortization period.
Upon receipt of such payment, the Agent shall execute and record a discharge of the Mortgage
encumbering the applicable Property.



ARTICLE 11




EVENTS OF DEFAULT BY BORROWER




     11.1 Event of Default Defined. The occurrence of any one or more of the following
shall constitute an Event of Default, and any Event of Default which may occur hereunder shall
constitute an Event of Default under each of the other Loan Documents:




     (a) Borrower fails to pay (i) any installment of principal or interest payable pursuant
to the Note within ten (10) days after written notice from the Agent that such installment
is past due, or (ii) any other amount payable to the Banks under the Note, this Agreement or
any of the other Loan Documents within twenty (20) days after written notice from the Agent
that such amount is past due in accordance with the terms hereof or thereof;




     (b) Borrower fails to perform or cause to be performed any other obligation or observe
any other condition, covenant, term, agreement or provision required to be performed or
observed by Borrower under the Note, this Agreement or any of the other Loan Documents not
otherwise described in Sections 11.1(a), or (c) through (p); provided, however, that if the
Note, this Agreement or other applicable Loan Document does not provide for a specific
grace, notice or cure period, and further provided that if such failure by its nature can be
cured, then so long as the continued operation and safety of the Property, and the priority,
validity and enforceability of the liens created by the Mortgages or any of the other Loan
Documents and the value of the Property are not impaired, threatened or jeopardized,
Borrower shall have a period (the “Cure Period”) of thirty (30) days after Borrower
obtains actual knowledge of such failure or receives written notice of such failure to cure
the same or, if the failure is of a kind which cannot be cured within thirty (30) days, if
Borrower undertakes to cure the failure within thirty (30) days after Borrower obtains
actual knowledge of such failure or receives written notice of such failure and thereafter
diligently pursues such cure, the Cure Period shall be extended for a reasonable time
necessary to complete such cure, and an Event of Default shall not be deemed to exist during
the Cure Period;




     (c) The existence of any inaccuracy or untruth in any material respect in any
representation or warranty contained in this Agreement or any of the other Loan Documents or
of any statement or certification as to facts delivered to Agent by Borrower or Guarantor;




     (d) The occurrence of a Prohibited Transfer;




     (e) The existence of any collusion, fraud, dishonesty or bad faith by or with the
acquiescence of Borrower or Guarantor which in any way relates to or affects the Loans or
the Property;



26









 






     (f) Borrower or Guarantor (i) files a voluntary petition in bankruptcy or is
adjudicated a bankrupt or insolvent or files any petition or answer seeking any
reorganization, arrangement, composition, readjustment, liquidation, dissolution or similar
relief under the present or any future federal, state, or other statute or law, or (ii)
seeks or consents to or acquiesces in the appointment of any trustee, receiver or similar
officer of Borrower or of all or any substantial part of the property of Borrower or
Guarantor or any of the Property; or all or a substantial part of the assets of Borrower or
Guarantor are attached, seized, subjected to a writ or distress warrant or are levied upon
unless the same is released or located within ninety (90) days;




     (g) The commencement of any involuntary petition in bankruptcy against Borrower or
Guarantor or the institution against Borrower or Guarantor of any reorganization,
arrangement, composition, readjustment, dissolution, liquidation or similar proceedings
under any present or future federal, state or other statute or law, or the appointment of a
receiver, trustee or similar officer for all or any substantial part of the property of
Borrower or Guarantor, which shall remain undismissed or undischarged for a period of ninety
(90) days;




     (h) The dissolution, unless corrected promptly within the time permitted by applicable
law, or termination of Borrower or Guarantor;




     (i) The occurrence of an “Event of Default” under any of the Notes, the Mortgages or
any of the other Loan Documents; or




     (j) Nonpayment by Borrower of any Rate Management Obligation when due or the breach by
Borrower of any term, provision or condition contained in any Rate Management Agreement.



ARTICLE 12




AGENT’S REMEDIES UPON EVENT OF DEFAULT




     12.1 Remedies Conferred upon Agent. Upon the occurrence of any Event of Default,
Agent, in addition to all remedies conferred upon Agent by law and by the terms of the Note, the
Mortgages and the other Loan Documents, may, and at the direction of the Required Banks shall, and
upon occurrence of an Event of Default described in Section 11.1(j) shall, pursue any one or more
of the following remedies concurrently or successively, it being the intent hereof that none of
such remedies shall be to the exclusion of any others:




     (a) Declare the Notes to be due and payable forthwith, without presentment, demand,
protest or other notice of any kind, all of which Borrower hereby expressly waives, and




     (b) Exercise or pursue any other remedy or cause of action permitted at law or in
equity or under this Agreement or any other Loan Document, including, but not limited to,
foreclosure of the Mortgages and enforcement of all Loan Documents.



     12.2 Right of Banks to Make Advances to Cure Event of Defaults; Obligatory Advances.
If an Event of Default shall occur as a result of Borrower’s failure to perform any of its
covenants or agreements herein or in any of the other Loan Documents contained, Agent may (but
shall not be required to) perform any of such covenants and agreements, and any amounts expended by
Agent in so doing, and any amounts expended by Agent pursuant to Section 12.1 hereof and any
amounts advanced by the Banks pursuant to this Agreement shall be deemed advanced by the Banks
under an obligation to do so regardless of the identity of the person or persons to whom said funds
are disbursed. Amounts advanced



27









 




by the Banks to protect their security for the Loan are obligatory advances hereunder and
shall constitute additional indebtedness payable on demand and evidenced and secured by the Loan
Documents.




     12.3 Attorneys’ Fees. Borrower will pay Agent’s reasonable attorneys’ fees and costs
in connection with the negotiation, preparation, administration and enforcement of this Agreement
and the other Loan Documents, which shall also include reasonable attorneys’ fees and time charges
of attorneys who may be employees of the Agent or any affiliate of the Agent; without limiting the
generality of the foregoing, if at any time or times hereafter Agent employs counsel for advice or
other representation with respect to any matter concerning Borrower, this Agreement, the Property
or the Loan Documents or if the Banks employ one or more counsel to protect, collect, lease, sell,
take possession of, or liquidate any of the Property, or to attempt to enforce or protect any
security interest or lien or other right in any of the Property or under any of the Loan Documents,
or to enforce any rights of the Banks or obligations of Borrower or any other person, firm or
corporation which may be obligated to the Banks by virtue of this Agreement or under any of the
Loan Documents or any other agreement, instrument or document, heretofore or hereafter delivered to
Agent in furtherance hereof, then in any such event, all of the attorneys’ fees arising from such
services, and any expenses, costs and charges relating thereto, shall constitute an additional
indebtedness owing by Borrower to the Banks payable on demand and evidenced and secured by the Loan
Documents; provided, however, that in connection with any enforcement proceedings, the Agent shall
be entitled to recover attorney fees only in the event it is the prevailing party.



     12.4 No Waiver. No failure by Agent to exercise, or delay by Agent in exercising, any
right, power or privilege hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right, power or privilege hereunder preclude any other or further exercise
thereof, or the exercise of any other right, power or privilege. The rights and remedies provided
in this Agreement and in the Loan Documents are cumulative and not exclusive of each other or of
any right or remedy provided at law or in equity. No notice to or demand on Borrower in any case,
in itself, shall entitle Borrower to any other or further notice or demand in similar or other
circumstances or constitute a waiver of the rights of Agent to any other or further action in any
circumstances without notice or demand.



     12.5 Default Rate. From and after the date of any Event of Default until the date on
which such Event of Default is cured or waived, interest on funds outstanding hereunder shall
accrue at the Default Rate and be payable on demand. The failure of Agent to charge interest at
the Default Rate shall not be evidence of the absence of an Event of Default or waiver of an Event
of Default by Agent.



ARTICLE 13




THE AGENT




     13.1 Appointment and Authorization.




     (a) Each Bank hereby irrevocably (subject to Section 13.9) appoints, designates and
authorizes Agent to take such action on its behalf under the provisions of this Agreement
and each other Loan Document and to exercise such powers and perform such duties as are
expressly delegated to it by the terms of this Agreement or any other Loan Document,
together with such powers as are reasonably incidental thereto. Notwithstanding any
provision to the contrary contained elsewhere in this Agreement or in any other Loan
Document, Agent shall not have any duty or responsibility except those expressly set forth
herein, nor shall Agent have or be deemed to have any fiduciary relationship with any Bank,
and no implied covenants, functions, responsibilities, duties, obligations or liabilities
shall be read into this Agreement or any other Loan Document or otherwise exist against
Agent. Without limiting the generality of the foregoing sentence, the use of the term
“agent” herein and in other Loan Documents with



28









 







reference to the Agent is not intended to connote any fiduciary or other implied (or
express) obligations arising under agency doctrine of any applicable law. Instead, such
term is used merely as a matter of market custom, and is intended to create or reflect only
an administrative relationship between independent contracting parties.




     (b) Agent may execute any of its duties under this Agreement or any other Loan Document
by or through agents, employees or attorneys-in-fact and shall be entitled to advice of
counsel concerning all matters pertaining to such duties. Agent shall not be responsible
for the negligence or misconduct of any agent or attorney-in-fact that it selects in the
absence of gross negligence or willful misconduct.



     13.2 Actions Requiring Consent and Approval.




     (a) Agent may amend or waive any of the provisions of this Agreement or any of the
other Loan Documents, or consent to any departure by any party to the Loan Documents there
from which amendment, waiver or consent is intended to be within Agent’s discretion or
determination, or otherwise in Agent’s reasonable determination shall not result in a
material adverse change. Otherwise, no such amendment, waiver or consent shall be effective
unless in writing, signed by the Required Banks, and Borrower or the applicable party to the
Loan Documents, as the case may be, and acknowledged by Agent and each such waiver or
consent shall be effective only in the specific instance and for the specific purpose for
which given. Notwithstanding the foregoing, Required Lender consent shall be required for
the following:




     (i) Agent shall not, without the prior approval or consent of the Required
Banks, appoint a successor Agent, provided that no Bank shall unreasonably withhold
its consent to the appointment of a successor Agent and further provided that
nothing contained in this Section 13.2 shall limit the rights of Agent under
Section 13.9 in the event a successor Agent is not appointed within thirty (30)
days of the retiring Agent giving notice of its resignation;




     (ii) Waive any non-monetary Event of Default on the part of the Borrower of
Guarantor;




     (b) Agent shall not undertake any of the following actions without the prior approval
or consent of each Bank:




     (i) Extend the Maturity Date or forgive all or any portion of the principal
amount of the Loan or any accrued interest thereon, or any other amendment of this
Agreement or the other Loan Documents which would reduce the underlying interest
rate or the rate at which fees are calculated or forgive any loan fee, or extend
the time of payment of any principal, interest or fees;




     (ii) Amend the recourse provisions in the Guaranty;




     (iii) Modify the percentage specified in the definition of Required Banks;




     (iv) Increase of the amount of the Loan;




     (v) Amend this Section 13.2(b);




     (vi) Waive a monetary default under the Loan Documents;



29









 






     (vii) Amend any of the conditions to the Loan Closing set forth in Article 6
of this Agreement;




     (viii) Release all or any portion of any collateral for the Loan except in
accordance with the terms and provisions of Section 13.10 hereof or any other Loan
Document; and




     (ix) Consent to any additional indebtedness of Borrower secured by all or any
portion of the Property, except as may be provided for in the Loan Documents.




     (c) No provision of Article 13 or other provision of this Agreement affecting the Agent
in its capacity as such shall be amended, modified or waived without the written consent of
the Agent.




     (d) In addition to the required consents or approvals referred to in subsections (a),
(b) and (c) above, Agent may, but shall not be required to, at any time request instructions
from the Required Banks with respect to any actions or approvals which, by the terms of this
Agreement or of any of the Loan Documents, Agent is permitted or required to take or to
grant without instructions from the Required Banks, and if such instructions are promptly
requested, Agent shall be absolutely entitled to refrain from taking any action or to
withhold any approval and shall not be under any liability whatsoever for refraining from
taking any action or withholding any approval under any of the Loan Documents until it shall
have received such instructions from the Required Banks. Without limiting the foregoing, no
Bank shall have any right of action whatsoever against Agent as a result of Agent acting or
refraining from acting under this Agreement or any of the other Loan Documents in accordance
with the instructions of the Required Banks. Agent shall promptly notify each Bank at any
time that the Required Banks have instructed Agent to act or refrain from acting pursuant
hereto.




     (e) If an Event of a Default occurs hereunder or under any of the Loan Documents, Agent
may make the determination to accelerate the Loan and exercise or refrain from exercising
remedies hereunder (and Agent shall do so at the written direction of the Required Banks).
Notwithstanding the foregoing, Agent may take any action it deems to be necessary from time
to time to protect the collateral.




     (f) Each Bank authorizes and directs Agent to enter into the Loan Documents other than
this Agreement. Each Bank agrees that any action taken by Agent at the direction or with
the consent of the Required Bank in accordance with the provisions of this Agreement or any
other Loan Document, and the exercise by Agent at the direction or with the consent of the
Required Banks of the powers set forth herein or therein, together with such other powers as
are reasonably incidental thereto, shall be authorized and binding upon all of the Banks,
except for actions specifically requiring the approval of all of the Banks. All
communications from Agent to the Banks requesting a Bank’s determination, consent, approval
or disapproval (i) shall be given in the form of a written notice to each Bank, (ii) shall
be accompanied by a description of the matter or item as to which such determination,
approval, consent or disapproval is requested, or shall advise each Bank where such matter
or item may be inspected, or shall otherwise describe the matter or issue to be resolved,
(iii) shall include, if reasonably requested and to the extent not previously provided
written materials and a summary of all oral information provided to Agent by Borrower in
respect of the matter or issue to be resolved, and (iv) shall include Agent’s recommended
course of action or determination in respect thereof. Each Bank shall reply promptly, but
in any event within ten (10) days after receipt of the request therefor from Agent (the
“Bank Reply Period”). Unless written notice to Agent that a Bank objects to the



30









 







recommendation or determination of Agent (together with a written explanation of the
reasons behind such objection) within the Bank Reply Period, such party shall be deemed to
have approved of or consented to such recommendation or determination. With respect to
decisions requiring the approval of the Required Banks or all of the Banks, Agent shall
submit its recommendation or determination for approval of or consent to such recommendation
or determination to each Bank and upon receiving the required approval or consent shall, to
the extent feasible, follow the course of action or determination recommended by Agent or
such other course of action recommended by the Required Banks, and each non-responding party
shall be deemed to have concurred with such recommended course of action.




     (g) Until such time as Borrower is otherwise instructed in writing by the Agent or the
Required Banks, Borrower may rely on the direction, consent or approval of Agent as the
direction, consent or approval of the Banks.



     13.3 Liability of Agent. None of Agent nor any of its directors, officers, employees
or agents shall (i) be liable for any action taken or omitted to be taken by any of them under or
in connection with this Agreement or any other Loan Document or the transactions contemplated
hereby (except to the extent resulting from its own gross negligence or willful misconduct in
connection with the duties expressly set forth herein as determined by a final, non-appealable
judgment by a court of competent jurisdiction), or (ii) be responsible in any manner to any of the
Banks or any Participant for any recital, statement, representation or warranty made by Borrower,
Guarantor, or any member, partner, shareholder or officer of Borrower or Guarantor, contained in
this Agreement or in any other Loan Document, or in any certificate, report, statement or other
document referred to or provided for in, or received by the Agent under or in connection with, this
Agreement or any other Loan Document, or the validity, effectiveness, genuineness, enforceability
or sufficiency of this Agreement or any other Loan Document (or the creation, perfection or
priority of any lien, mortgage or security interest therein), or for any failure of Borrower or any
other party to any Loan Document to perform its obligations hereunder or thereunder. Agent shall
not be under any obligation to any Bank to ascertain or to inquire as to the observance or
performance of any of the agreements contained in, or conditions of, this Agreement or any other
Loan Document, or to inspect the properties, books or records of Borrower or Guarantor.



     13.4 Reliance by Agent. Agent shall be entitled to rely, and shall be fully protected
in relying, upon any writing, resolution, notice, consent, certificate, affidavit, letter,
telegram, facsimile, telex or telephone message, statement or other document or conversation
believed by it to be genuine and correct and to have been signed, sent or made by the proper person
or party, and upon advice and statements of legal counsel (including counsel to Borrower),
independent accountants and other experts selected by the Agent. Agent shall be fully justified in
failing or refusing to take any action under this Agreement or any other Loan Document unless it
shall first receive such advice or concurrence of the Required Banks as it deems appropriate and,
if it so requests, confirmation from the Banks of their obligation to indemnify the Agent against
any and all liability and expense which may be incurred by it by reason of taking or continuing to
take any such action. Agent shall in all cases be fully protected in acting, or in refraining from
acting, under this Agreement or any other Loan Document in accordance with a request or consent of
the Required Banks and such request and any action taken or failure to act pursuant thereto shall
be binding upon all of the Banks. For purposes of determining compliance with the conditions
specified in Section 13, each Bank that has signed this Agreement shall be deemed to have consented
to, approved or accepted or to be satisfied with, each document or other matter required thereunder
to be consented to or approved by or acceptable or satisfactory to a Bank unless the Agent shall
have received written notice from such Bank prior to the proposed Loan Closing Date specifying its
objection thereto.



31









 





     13.5 Notice of Default. Agent shall not be deemed to have knowledge or notice of the
occurrence of any Event of Default except with respect to defaults in the payment of principal,
interest and fees required to be paid to Agent for the account of the Banks, unless Agent shall
have received written notice from a Bank or Borrower referring to this Agreement, describing such
Event of Default and stating that such notice is a “notice of default”. Agent will notify the
Banks of its receipt of any such notice. Agent shall take such action with respect to such Event
of Default as may be requested by the Required Banks in accordance with this Section 13;
provided that unless and until Agent has received any such request, Agent may (but shall
not be obligated to) take such action, or refrain from taking such action, with respect to such
Event of Default as it shall deem advisable or in the best interest of the Banks.



     13.6 Credit Decision. Each Bank acknowledges that Agent has not made any
representation or warranty to it, and that no act by Agent hereafter taken, including any review of
the affairs of Borrower and Guarantor, shall be deemed to constitute any representation or warranty
by Agent to any Bank as to any matter, including whether the Agent has disclosed material
information in its possession. Each Bank represents to Agent that it has, independently and
without reliance upon Agent and based on such documents and information as it has deemed
appropriate, made its own appraisal of and investigation into the business, prospects, operations,
property, financial and other condition and creditworthiness of Borrower and Guarantor, and made
its own decision to enter into this Agreement and to extend credit to Borrower hereunder. Each
Bank also represents that it will, independently and without reliance upon Agent and based on such
documents and information as it shall deem appropriate at the time, continue to make its own credit
analysis, appraisals and decisions in taking or not taking action under this Agreement and the
other Loan Documents, and to make such investigations as it deems necessary to inform itself as to
the business, prospects, operations, property, financial and other condition and creditworthiness
of Borrower. Except for notices, reports and other documents expressly herein required to be
furnished to the Banks by Agent, Agent shall not have any duty or responsibility to provide any
Bank with any credit or other information concerning the business, prospects, operations, property,
financial or other condition or creditworthiness of Borrower which may come into the possession of
the Agent.



     13.7 Bank Indemnification. Whether or not the transactions contemplated hereby are
consummated, the Banks shall indemnify upon demand Agent and its directors, officers, employees and
agents (to the extent not reimbursed by or on behalf of Borrower and without limiting the
obligation of Borrower to do so), pro rata, from and against any and all actions, causes of action,
suits, losses, liabilities, damaged and expenses, including attorneys’ fees and expenses
(collectively, the “Indemnified Liabilities”); provided that no Bank shall be liable for
any payment to Agent of any portion of the Indemnified Liabilities to the extent determined by a
final, non-appealable judgment by a court of competent jurisdiction to have resulted from Agent’s
gross negligence or willful misconduct. No action taken in accordance with the directions of the
Required Banks shall constitute gross negligence or willful misconduct for purposes of this
Agreement. Without limitation of the foregoing, each Bank shall reimburse Agent upon demand for
its ratable share of any costs or out-of-pocket expenses (including Loan Expenses) incurred by the
Agent in connection with the preparation, execution, delivery, administration, modification,
amendment or enforcement (whether through negotiations, legal proceedings or otherwise) of, or
legal advice in respect of rights or responsibilities under, this Agreement, any other Loan
Document, or any document contemplated by or referred to herein, to the extent that the Agent is
not reimbursed for such expenses by or on behalf of Borrower. The undertaking in this Section
shall survive repayment of the Loans, cancellation of the Notes, any foreclosure under, or
modification, release or discharge of, any or all of the Loan Documents, termination of this
Agreement and the resignation or replacement of the Agent.



     13.8 Agent in Individual Capacity. LaSalle and its affiliates may make loans to,
issue letters of credit for the account of, accept deposits from, acquire equity interests in and
generally engage in any kind of banking, trust, financial advisory, underwriting or other business
with Borrower and Guarantor as



32









 




though LaSalle were not Agent hereunder and without notice to or consent of the Banks. The
Banks acknowledge that, pursuant to such activities, LaSalle or its affiliates may receive
information regarding Borrower or Guarantor (including information that may be subject to
confidentiality obligations in favor of Borrower or Guarantor) and acknowledge that Agent shall be
under no obligation to provide such information to them. With respect to their Loans (if any),
LaSalle and its affiliates shall have the same rights and powers under this Agreement as any other
Bank and may exercise the same as though LaSalle were not the Agent, and the terms “Bank” and
“Banks” include LaSalle and its affiliates, to the extent applicable, in their individual
capacities.




     13.9 Successor Agent. Agent may resign as Agent upon thirty (30) days notice to the
Banks. If Agent resigns under this Agreement, the Required Banks shall, with (so long as no Event
of Default exists) the consent of Borrower (which shall not be unreasonably withheld or delayed),
appoint from among the Banks a successor agent for the Banks. If no successor agent is appointed
prior to the effective date of the resignation of Agent, Agent may appoint, after consulting with
the Banks and Borrower, a successor agent from among the Banks. Upon the acceptance of its
appointment as successor agent hereunder, such successor agent shall succeed to all the rights,
powers and duties of the retiring Agent and the term “Agent” shall mean such successor agent, and
the retiring Agent’s appointment, powers and duties as Agent shall be terminated. After any
retiring Agent’s resignation hereunder as Agent, the provisions of this Section 13 shall inure to
its benefit as to any actions taken or omitted to be taken by it while it was Agent under this
Agreement. If no successor agent has accepted appointment as Agent by the date which is 30 days
following a retiring Agent’s notice of resignation, the retiring Agent’s resignation shall
nevertheless thereupon become effective and the Banks shall perform all of the duties of the Agent
hereunder until such time, if any, as the Required Banks appoint a successor agent as provided for
above.



     13.10 Collateral Matters. The Banks irrevocably authorize Agent, at its option and in
its discretion, to release any Lien granted to or held by Agent under any Loan Document (i) upon
payment in full of all Loans and all other obligations of Borrower hereunder; (ii) constituting
property sold or to be sold or disposed of as part of or in connection with any disposition
permitted hereunder; or (iii) if approved, authorized or
ratified in writing by all of the Banks.



     13.11 Agent May File Proofs of Claim. In case of the pendency of any receivership,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to Borrower or Guarantor, the Agent (irrespective of whether the
principal of any Loan shall then be due and payable as herein expressed or by declaration or
otherwise and irrespective of whether the Agent shall have made any demand on the Borrower) shall
be entitled and empowered, by intervention in such proceeding or otherwise:




     (a) to file and prove a claim for the whole amount of the principal and interest owing
and unpaid in respect of the Loans, and all other obligations that are owing and unpaid and
to file such other documents as may be necessary or advisable in order to have the claims of
the Banks and the Agent (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Banks and the Agent and their respective agents and
counsel and all other amounts due the Banks and the Agent hereunder allowed in such judicial
proceedings; and




     (b) to collect and receive any monies or other property payable or deliverable on any
such claims and to distribute the same;




and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar
official in any such judicial proceeding is hereby authorized by each Bank to make such
payments to the Agent and, in the event that the Agent shall consent to the making of such
payments directly to



33









 







the Banks, to pay to the Agent any amount due for the reasonable compensation, expenses,
disbursements and advances of the Agent and its agents and counsel, and any other amounts
due the Agent hereunder.




     Nothing contained herein shall be deemed to authorize the Agent to authorize or
consent to or accept or adopt on behalf of any Bank any plan of reorganization, arrangement,
adjustment or composition affecting the Loans or the rights of any Bank or to authorize the
Agent to vote in respect of the claim of any Bank in any such proceeding.



ARTICLE 14




MISCELLANEOUS




     14.1 Time is of the Essence. Borrower agrees that time is of the essence in all of
its covenants under this Agreement.



     14.2 Agent’s Determination of Facts. Agent and/or Banks at all times shall be free to
establish independently to its or their satisfaction and in its or their sole and absolute
discretion the existence or nonexistence of any fact or facts, the existence or nonexistence of
which is a condition of this Agreement.



     14.3 Prior Agreements. This Agreement and the other Loan Documents, and any other
documents or instruments executed pursuant thereto or contemplated thereby, shall represent the
entire, integrated agreement between the parties hereto with respect to the Loan, and shall
supersede all prior negotiations, representations or agreements pertaining thereto, either oral or
written. This Agreement and any provision hereof shall not be modified, amended, waived or
discharged in any manner other than by a written amendment executed by all parties to this
Agreement.



     14.4 Disclaimer by Banks. Borrower is not or shall not be an agent of Agent or the
Banks for any purposes, and neither Agent nor the Banks are venture partners with Borrower in any
manner whatsoever. Approvals granted by Agent or the Banks for any matters covered under this
Agreement shall be narrowly construed to cover only the parties and facts identified in any written
approval or, if not in writing, such approvals shall be solely for the benefit of Borrower.



     14.5 Borrower Indemnification. Borrower agrees to defend (with counsel satisfactory
to Lender), protect, indemnify and hold harmless Agent, each Bank, any parent corporation,
affiliated corporation or subsidiary of Agent or any Bank, and each of their respective officers,
directors, employees, attorneys and agents (each, an “Indemnified Party”) from and against
any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits,
claims, costs, expenses and distributions of any kind or nature (including, without limitation, the
disbursements and the reasonable fees of counsel for each Indemnified Party thereto, which shall
also include, without limitation, reasonable attorneys’ fees and time charges of attorneys who may
be employees of Agent, any Bank or any parent or affiliated corporation of Agent or any Bank),
which may be imposed on, incurred by, or asserted against, any Indemnified Party (whether direct,
indirect or consequential and whether based on any federal, state or local laws or regulations,
including, without limitation, securities, environmental laws and commercial laws and regulations,
under common law or in equity, or based on contract or otherwise) in any manner relating to or
arising out of this Agreement or any of the Loan Documents, or any act, event or transaction
related or attendant thereto, the preparation, execution and delivery of this Agreement, the Notes
and the Loan Documents, the making or issuance and management of the Loans, the use or intended use
of the proceeds of the Loans and the enforcement of Agent and any Bank’s rights and remedies under
this Agreement, the Notes, the Loan Documents, any other instruments and documents delivered
hereunder or



34









 




thereunder; provided, however, that Borrower shall not have any obligation hereunder to any
Indemnified Party with respect to disputes between the Banks or between the Banks and the Agent not
arising out of the wrongdoing of the Borrower or matters caused by or resulting from the willful
misconduct or gross negligence of such Indemnified Party. The Indemnified Parties shall give
notice as promptly as reasonably practical to the Borrower in the event they become aware of a
claim or potential claim for which they intend to seek indemnity under the provisions of this
Section 14.5. To the extent that the undertaking to indemnify set forth in the preceding sentence
may be unenforceable because it violates any law or public policy, Borrower shall satisfy such
undertaking to the maximum extent permitted by applicable law. Any liability, obligation, loss,
damage, penalty, cost or expense covered by this indemnity shall be paid to such Indemnified Party
on demand, and failing prompt payment, together with interest thereon at the Default Rate from the
date incurred by such Indemnified Party until paid by Borrower, shall be added to the obligations
of Borrower evidenced by the Notes and secured by the collateral securing the Loans. This indemnity
is not intended to excuse Agent or any Bank from performing hereunder. The provisions of this
section shall survive the closing of the Loans, the satisfaction and payment of the Notes and any
cancellation of this Agreement. Borrower shall also pay, and hold Agent and each Bank harmless
from, any and all claims of any brokers, finders or agents claiming a right to any fees in
connection with arranging the Loan. Each Bank hereby represents that it has not employed a broker
or other finder in connection with the Loans. Borrower represents and warrants that no brokerage
commissions or finder’s fees are to be paid in connection with the Loans.




     14.6 Captions. The captions and headings of various Articles and Sections of this
Agreement and exhibits pertaining hereto are for convenience only and are not to be considered as
defining or limiting in any way the scope or intent of the provisions hereof.



     14.7 Inconsistent Terms and Partial Invalidity. In the event of any inconsistency
among the terms hereof (including incorporated terms), or between such terms and the terms of any
other Loan Document, Agent may elect which terms shall govern and prevail. If any provision of
this Agreement, or any paragraph, sentence, clause, phrase or word, or the application thereof, in
any circumstances, is adjudicated by a court of competent jurisdiction to be invalid, the validity
of the remainder of this Agreement shall be construed as if such invalid part were never included
herein.



     14.8 Gender and Number. Any word herein which is expressed in the masculine or neuter
gender shall be deemed to include the masculine, feminine and neuter genders. Any word herein
which is expressed in the singular or plural number shall be deemed, whenever appropriate in the
context, to include the singular and the plural.



     14.9 Notices. Any notices, communications and waivers under this Agreement shall be
in writing and shall be (i) delivered in person, (ii) mailed, postage prepaid, either by registered
or certified mail, return receipt requested, or (iii) sent by overnight express carrier, addressed
in each case as follows:



	 	 	 	 	 
	 

	 	To Agent:
	 	LaSalle Bank Midwest National Association
	 

	 	 	 	2600 West Big Beaver Road
	 

	 	 	 	Troy, Michigan 48084
	 

	 	 	 	Attention: Commercial Real Estate
	 
	 	 	 	 
	 

	 	With copies to:
	 	Daniel C. Watson, Esq.
	 

	 	 	 	Dykema Gossett PLLC
	 

	 	 	 	400 Renaissance Center
	 

	 	 	 	Detroit, Michigan 48243






35









 






	 	 	 	 	 
	 

	 	To a Bank:
	 	See notice addresses set forth on Schedule 3.1 hereto.
	 
	 	 	 	 
	 

	 	To Borrower:
	 	Agree Limited Partnerhip/Agree Realty Corporation
	 

	 	 	 	31850 Northwestern Highway
	 

	 	 	 	Farmington Hills, Michigan 48334
	 

	 	 	 	Attention: Richard Agree
	 
	 	 	 	 
	 

	 	With a copy to:
	 	Leon M. Schurgin, Esq.
	 

	 	 	 	Bodman LLP
	 

	 	 	 	Suite 500
	 

	 	 	 	201 W. Big Beaver Road
	 

	 	 	 	Troy, Michigan 48084





or to any other address as to any of the parties hereto, as such party shall designate in a written
notice to the other party hereto. All notices sent pursuant to the terms of this Section shall be
deemed received (i) if personally delivered, then on the date of delivery, (ii) if sent by
overnight, express carrier, then on the next Business Day immediately following the day sent, or
(iii) if sent by registered or certified mail, then on the earlier of the third Business Day
following the day sent or when actually received.




     14.10 Effect of Agreement. The submission of this Agreement and the Loan Documents to
Borrower for examination does not constitute a commitment or an offer by Agent to make a commitment
to lend money to Borrower; this Agreement shall become effective only upon execution by Banks and
delivery hereof by Agent to Borrower.



     14.11 Governing Law. This Agreement has been negotiated, executed and delivered at
Troy, Michigan, and shall be construed and enforced in accordance with the laws of the State of
Michigan, without reference to the choice of law or conflicts of law principles of the State.



     14.12 Consent to Jurisdiction. TO INDUCE BANKS TO ACCEPT THE NOTES, BORROWER
IRREVOCABLY AGREES THAT, SUBJECT TO AGENT’S SOLE AND ABSOLUTE ELECTION, ALL ACTIONS OR PROCEEDINGS
IN ANY WAY ARISING OUT OF OR RELATED TO THE LOAN DOCUMENTS WILL BE LITIGATED IN COURTS HAVING SITUS
IN OAKLAND COUNTY, MICHIGAN. BORROWER HEREBY CONSENTS AND SUBMITS TO THE EXTENT PERMITTED BY
APPLICABLE LAW, TO THE JURISDICTION OF ANY COURT LOCATED WITHIN OAKLAND COUNTY, MICHIGAN, WAIVES
PERSONAL SERVICE OF PROCESS UPON BORROWER, AND AGREES THAT ALL SUCH SERVICE OF PROCESS MAY BE MADE
BY REGISTERED MAIL DIRECTED TO BORROWER AT THE ADDRESS STATED HEREIN AND SERVICE SO MADE WILL BE
DEEMED TO BE COMPLETED UPON ACTUAL RECEIPT.



     14.13 Waiver of Jury Trial. BORROWER, AGENT AND BANKS (BY ACCEPTANCE HEREOF), HAVING
BEEN REPRESENTED BY COUNSEL EACH KNOWINGLY AND VOLUNTARILY WAIVES ANY RIGHT TO A TRIAL BY JURY IN
ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS (A) UNDER THIS AGREEMENT OR ANY RELATED
AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT OR AGREEMENT DELIVERED OR WHICH MAY IN THE
FUTURE BE DELIVERED IN CONNECTION WITH THIS AGREEMENT OR (B) ARISING FROM ANY BANKING RELATIONSHIP
EXISTING IN CONNECTION WITH THIS AGREEMENT, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING WILL BE
TRIED BEFORE A COURT AND NOT BEFORE A JURY. BORROWER AGREES THAT IT WILL NOT ASSERT



36









 




ANY CLAIM AGAINST AGENT OR BANKS OR ANY OTHER PERSON INDEMNIFIED UNDER THIS AGREEMENT ON ANY
THEORY OF LIABILITY FOR SPECIAL, INDIRECT, CONSEQUENTIAL, INCIDENTAL OR PUNITIVE DAMAGES.




     14.14 Counterparts; Facsimile Signatures. This Agreement may be executed in any
number of counterparts and by the different parties hereto on separate counterparts and each such
counterpart shall be deemed to be an original, but all such counterparts shall together constitute
but one and the same Agreement. Receipt of an executed signature page to this Agreement by
facsimile or other electronic transmission shall constitute effective delivery thereof. Electronic
records of executed Loan Documents maintained by Agent shall be deemed to be originals thereof.



     14.15 Customer Identification — USA Patriot Act Notice. Each Bank and Agent (for
itself and not on behalf of any Bank) hereby notifies Borrower that pursuant to the requirements of
the USA Patriot Act (Title III of Pub. L. 107-56, signed into law October 26, 2001) (the
“Act”), and each Bank’s and Agent’s policies and practices, it is required to obtain,
verify and record certain information and documentation that identifies Borrower, which information
includes the name and address of Borrower and such other information that will allow such Bank or
Agent to identify Borrower in accordance with the Act.



[SIGNATURE PAGE FOLLOWS]




37









 








     IN WITNESS WHEREOF, the Banks and Borrower have caused this Loan Agreement to be executed as
of the day and year first above written.



	 	 	 	 	 
	 	BORROWER:



AGREE LIMITED PARTNERSHIP, a Delaware limited partnership

 	 
	 	By: Agree Realty Corporation, a Maryland corporation
 	 
	 	Its: General Partner 	 
	 	 	 	 
	 
	 	 	By:  	/S/ Richard Agree
 	 
	 	 	Name:  	Richard Agree 	 
	 	 	Title:  	President 	 
	 
	 	AGENT:



LASALLE BANK MIDWEST NATIONAL ASSOCIATION, a national banking association

 	 
	 	By:  	/s/ Kathleen W. Bozek
 	 
	 	Name:  	Kathleen W. Bozek 	 
	 	Title:  	Vice President 	 
	 
	 	THE BANKS:



LASALLE BANK MIDWEST NATIONAL ASSOCIATION, a national banking association

 	 
	 	By:  	/s/ Kathleen W. Bozek
 	 
	 	Name:  	Kathleen W. Bozek 	 
	 	Title:  	Vice President 	 
	 
	 	RAYMOND JAMES BANK, FSB, a federal savings bank

 	 
	 	By:  	/s/ Thomas G. Scott
 	 
	 	Name:  	Thomas G. Scott 	 
	 	Title:  	Senior Vice President 	 
	 




38









 





SCHEDULE 3.1




THE BANKS AND LOAN AMOUNTS




	 	 	 	 	 	 	 	 	 
	BANK	 	LOAN AMOUNTS	 	PRO RATA SHARE
	LaSalle Bank
Midwest National Association
	 	$	14,800,000.00	 	 	 	59.677419354	%
	
2600 West Big Beaver Road

Troy, Michigan 48084

Attn: Commercial Real Estate
	 	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Raymond James Bank, FSB
	 	$	10,000,000.00	 	 	 	40.322580645	%
	710 Carillon Parkway

St. Petersburg, Florida 33716

Attn: Thomas Scott
	 	 	 	 	 	 	 	 








 









 








SCHEDULE 10.1




SCHEDULE OF RELEASE PAYMENTS




	 	 	 	 	 
	 	 	REQUIRED
	 	 	PRINCIPAL PAYMENT
	PROPERTY	 	FOR RELEASE
	6421 West Saginaw

Delta Township, MI
	 	$	3,975,000	 
	 
	 	 	 	 
	2643 Kalamazoo

Grand Rapids, MI
	 	$	3,780,000	 
	 
	 	 	 	 
	16977 & 17001 Newburgh Road

Livonia, MI
	 	$	5,100,000	 
	 
	 	 	 	 
	21790 & 21700 21 Mile Road

Macomb Township, MI
	 	$	5,055,000	 
	 
	 	 	 	 
	56805 Van Dyke Avenue

Shelby Township, MI
	 	$	2,510,000	 
	 
	 	 	 	 
	25966 Gratiot

Roseville, MI
	 	$	2,750,000	 
	 
	 	 	 	 
	2255 South Jackson Road

Summit Township, MI
	 	$	1,630,000	 







Schedule 10.1 - 1









 








EXHIBIT “A”




THE PROPERTY




Property known as 6421 West Saginaw, Delta Township, MI described as:



Land Situated in the Township of Delta, County of Eaton, State of Michigan.



Commencing at the Northeast corner of Section 15, T4N, R3W, Delta Township, Eaton County, Michigan;
thence S 00°2719“E 50.00 feet along the centerline of Creyts Road (66’ Wide) and the East line of
said Section 15; thence S 89°51’50“W 50.00 feet for a PLACE OF BEGINNING; thence S 45°17’45“E 24.11
feet (recorded as Southeast 24.04 feet) to the Westerly right-of-way line of said Creyts Road (66’
Wide); thence S 0002719“E 181.00 feet along said West right-of-way line; thence S 89°51’50” W
182.00 feet; thence S 00°27’19“E 100.00 feet; thence S 89°51’50” W 118.50 feet; thence N 00°27’1 W
246.01 feet; thence S 89°32’41” W 2.50 feet; thence N 00°2719“W 52.00 feet; to the Southerly
right-of-way line of Saginaw Highway (100’ Wide); thence N 89°51’50” E 286.00 feet along said South
right-of-way line to the Place of Beginning, being part of the Northeast 1/4 of said Section 15.



TAX IDENTIFICATION NUMBER: 23-040-015-200-220-00




Property known as 2643 Kalamazoo, Grand Rapids, MI described as:



Land Situated in the City of Grand Rapids, County of Kent, State of Michigan.



Part of the Southeast 1/4 of Section 8, Town 6 North, Range 11 West, City of Grand Rapids, Kent
County, Michigan, described as: Commencing at the Southeast corner of Section 8; thence South
90°00’00” West 690.33 feet along the South line of Section 8; thence North 03°48’25” West 50.69
feet to a point on the North right-of-way line of 28th Street and the place of beginning; thence
North 03°48’25” West 149.31 feet parallel to the West line of the Southeast 1/4 of the Southeast
1/4 of Section 8; thence South 90°00’00” West 30.00 feet; thence North 03°48’25” West 207.59 feet
along the East line of Oakgrove Cemetery; thence South 89°49’30” East 307.77 feet; thence North
00°10’30” East 30.00 feet; thence North 34°34’57” West 142.24 feet; thence Northeasterly 191.52
feet along a 115.50 foot radius curve to the right, the chord of which bears North 12°55’12” East
170.32 feet; thence North 60°43’14” East 14.10 feet; thence Southeasterly 544.27 feet along a
3769.83 foot radius curve to the right, the chord of which bears South 25°16’02” East 543.80 feet;
thence South 35°21’20” West 225.40 feet along the Northwesterly line of a clear vision
right-of-way; thence Northwesterly 71.70 feet along a 57246.01 foot radius curve to the right, the
chord of which bears North 89°58’00” West 71.70 feet along the North line of 28th Street; thence
North 89°55’50” West 253.76 feet to the point of beginning.



TAX IDENTIFICATION NUMBER: 41-18-08-400-017




Property known as 16977 & 17001 Newburgh Road, Livonia, MI described as:



Land Situated in the City of Livonia, County of Wayne, State of Michigan.



A parcel of land being a part of the Northeast 1/4 of Section 18, Town 1 South, Range 9 East, City
of Livonia, Wayne County, Michigan, more particularly described as: Beginning at a point on the
South line


A-1 









 






of the Six Mile Road (180 feet wide), said point being South 89°58’ West 287.73 feet and South
00°02’ East 90.00 feet from the Southeast corner of said Section 18, Town ‘I South, Range 9 East,
thence North 89°58’ East along said South line 105.24 feet to a point; thence South 00°21’20” East
120.00 feet to a point; thence North 89°58’ East 123.00 feet to a point on the West line of
Newburgh Road (120 feet wide); thence South 00°21’20” East along said West line 413.01 feet to a
point; thence South 89°58’ West 231.24 feet to a point; thence North 00°02’ West 533.00 feet to the
point of beginning.



Together with, and subject to, the rights and benefits over adjacent parcels as disclosed in the
Declaration of Easements, Covenants, Conditions, and Restrictions recorded in Liber 45251, page
151, Wayne County Records.



TAX IDENTIFICATION NUMBER: 46-069-99-0001-024




Property known as 21790 & 21700 21 Mile Road, Macomb Township, MI described as:



Land Situated in the Township of Macomb, County of Macomb, State of Michigan.



Units 1 and 2, Agree/Macomb Township Condominium, according to the Master Deed recorded in Liber
18821, Page 532, Macomb County Records, and any amendments thereto, and designated as Macomb County
Condominium Subdivision Plan No. 1033, together with rights in general common elements and limited
common elements as set forth in the above Master Deed and as described in Act 59 of the Public Acts
of 1978.



TAX IDENTIFICATION NUMBER: 08-34-228-001 (Unit 1) and 08-34-228-002 (Unit 2)




Property known as 56805 Van Dyke Avenue, Shelby Township, MI described as:



Land
Situated in the Township of Shelby, County of Macomb, State of
Michigan.

A parcel of land located in the Northeast 1/4 of Section 4, Town 3 North, Range 12 East, Shelby
Township, Macomb County, Michigan, described as being parts of Lots 14 and 15 of Brown’s Little
Farms Subdivision (unrecorded) more particularly described as: Commencing at the Northeast corner
of said Section 4; thence South 01°47’44” East 343.54 feet along the centerline of Van Dyke Avenue
for a place of beginning; thence continuing along said centerline South 01°47’44” East 267.55 feet;
thence South 89°16’28” West 327.33 feet; thence North 00°34’34” West 268.35 feet; thence North
89°25’26” East 321.83 feet to the centerline of Van Dyke Avenue and to the place of beginning.



TAX IDENTIFICATION NUMBER: 07-04-226-025.




Property known as 25966 Gratiot, Roseville, MI described as:



Land Situated in the City of Roseville, County of Macomb, State of Michigan.



Part of Lot 27 of Assessor’s Plat No. 8, as recorded in Liber 18, page 27, Macomb County Records,
and also part of the Southwest 114 of Section 20, T1 N, R13E, City of Roseville, Macomb County,
Michigan, and being more particularly described as follows: Commencing at the West 1/4 corner of
Section 20, thence North 89 degrees 11 minutes 15 seconds East along the East-West 1/4 line of
Section 20, 1246.72 feet to the intersection of the East-West 1/4 line of Section 20 and the
Northeasterly extension of the Southeasterly line of Gratiot Avenue (204 feet wide); thence South
27 degrees 19 minutes 27 seconds


A-2 









 






West along the extension of the Southeasterly line of Gratiot Avenue, 37.42 feet to the Northwest
corner of said Lot 27 of Assessor’s Plat No. 8, being the point of beginning; thence North 89
degrees 11 minutes 15 seconds East along the North line of Lot 27, being also the South Right of
Way line of Frazho Road (66 feet wide), 103.44 feet; thence South 11 degrees 12 minutes 30 seconds
East 86.81 feet; thence South 01 degrees 12 minutes 30 seconds East 182.28 feet; thence South 27
degrees 21 minutes 58 seconds West 102.82 feet; thence North 62 degrees 38 minutes 02 seconds West
170.16 feet; thence North 34 degrees 05 minutes 31 seconds West 70.74 feet to a point on said
Southeasterly line of Gratiot Avenue; thence North 27 degrees 19 minutes 27 seconds East along said
Southeasterly line, 248.11 feet to the point of beginning.



TAX IDENTIFICATION NUMBER: 14-20-326-039




Property known as 2255 South Jackson Road, Summit Township, MI described as:



Land Situated in the Township of Summit, County of Jackson, State of Michigan.



Part of the Northwest 1/4 of Section 21, Town 3 South, Range 1 West, Summit Township, Jackson
County, Michigan, described as commencing at the West 1/4 corner of said Section 21; thence due
east, 1425.00 feet along the east and west 1/4 line of said Section 21 to the centerline of South
Jackson Road; thence N 10°37’00” W, 398.51 feet along the centerline of South Jackson Road; thence
N 11°18’00” W, 511.48 feet along the centerline of South Jackson Road to the point of beginning;
thence N 11°18’00” W, 316.58 feet along the centerline of South Jackson Road; thence N 88°49’30” E,
300.00 feet; thence S 05°58’21” E, 148.33 feet; thence N 74°01’39” E, 200.00 feet; thence S
05°58’21” E, 75.00 feet, thence S 43°36’05” W, 206.48 feet; thence N 89°59’49” W, 311.03 feet to
the point of beginning.



TAX IDENTIFICATION NUMBER: 000-13-21-176-046-02




A-3 









 





EXHIBIT “B”




FORM OF PROMISSORY NOTE




PROMISSORY NOTE




      



			
	$                    .00
	 	Date:                     , 20___
	Troy, Michigan
	 	Maturity Date:                     , 20___






     FOR VALUE RECEIVED, AGREE LIMITED PARTNERSHIP, a Delaware limited partnership (the
“Borrower”), hereby promises to pay to the order of                                                              (the
“Bank”) at the principal office of LaSalle Bank Midwest National Association (the
“Agent”) in Troy, Michigan, on or before the Maturity Date (as defined in the hereinafter
referred to Loan Agreement), which Maturity Date is subject to extension as provided in the Loan
Agreement, the principal amount of                                          and 00/100 DOLLARS ($_                    .00), in
accordance with the terms and provisions of that certain Loan Agreement dated as of                     , 20___,
executed by and among the Borrower, certain financial institutions (including the Bank) and the
Agent (as amended, restated, supplemented or otherwise modified from time to time, the “Loan
Agreement”). Capitalized words and phrases not otherwise defined herein shall have the
meanings assigned thereto in the Loan Agreement.



     The Borrower further promises to pay the outstanding principal balance of this Note in monthly
installments of principal, each in the amount corresponding to the applicable payment due date, as
shown in attached Schedule A, plus interest accrued to the due date of each payment on the unpaid
principal balance of this Note outstanding from time to time at the rates set forth in the Loan
Agreement. The outstanding principal balance hereof shall be repaid by the Borrower on the
Maturity Date, unless payable sooner pursuant to the provisions of the Loan Agreement. The Maturity
Date is subject to extension on the terms and conditions provided in the Loan Agreement. Payments
of both principal and interest are to be made in lawful money of the United States of America. The
Loans made by the Bank and all payments on account of the principal and interest thereof, shall be
recorded on the books and records of the Agent and the principal balance as shown on such books and
records shall be rebuttably presumptive evidence of the principal amount owing hereunder.



     This Note evidences indebtedness incurred under, and is subject to the terms and provisions
of, the Loan Agreement, to which Loan Agreement reference is hereby made for a statement of the
terms and provisions under which this Note may or must be paid prior to the Maturity Date, or
pursuant to which the Maturity Date may be accelerated. The holder of this Note is entitled to all
of the benefits and security provided for in the Loan Agreement.



     Except for such notices as may be expressly required under the Loan Documents, the Borrower
waives presentment, demand, notice, protest, and all other demands, or notices, in connection with
the delivery, acceptance, performance, default, or enforcement of this Note, and assents to any
extension or postponement of the time of payment or any other indulgence. No failure to exercise,
and no delay in exercising, any rights under any of the Loan Documents by the Agent of any holder
of this Note shall operate as a waiver of such rights.



     This Note shall be governed and construed in accordance with the laws of the State of Michigan
applicable to contracts made and to be performed entirely within such State.



B-1 









 





[SIGNATURE PAGE FOLLOWS]




B-2 









 








	 	 	 	 	 
	 	BORROWER:



AGREE LIMITED PARTNERSHIP, a Delaware limited partnership

 	 
	 	By:  	Agree Realty Corporation, a Maryland corporation
 	 
	 	Its:  General Partner 	 
	 	 	 	 
	 
	 	 	By:  	 	 
	 	 	Name:  	Richard Agree 	 
	 	 	Title:  	President 	 



B-3 









 






	 	 	 	 	 



SCHEDULE A




SCHEDULE OF PRINCIPAL PAYMENTS




	 	 	 
	PAYMENT DUE DATE
	 	REQUIRED

PRINCIPAL PAYMENT
	 
	 	 





B-4 









 





EXHIBIT “C”




PERMITTED EXCEPTIONS




C-1 









 





EXHIBIT “D”




FORM OF ASSIGNMENT AND ACCEPTANCE




     Reference is made to the Loan Agreement dated as of                     , 20___(as the same may be
amended, modified or supplemented from time to time in accordance with its terms, the “Loan
Agreement”) among (i) Agree Limited Partnership, a Delaware limited partnership (the
“Borrower”), (ii) the several banks and financial institutions from time to time parties to
the Agreement (collectively, the “Banks”) and (iii) LaSalle Bank Midwest National
Association, as agent for the Banks (in such capacity the “Agent”). Terms defined in the
Loan Agreement are used herein with the same meaning. This Assignment and Acceptance, between the
Assignor (as identified on Schedule 1 hereto) and the Assignee (as identified on Schedule 1 hereto)
is dated as of the Effective Date (as specified on Schedule 1 hereto, the “Effective
Date”).



     The Assignor hereby irrevocably sells and assigns to the Assignee without recourse to the
Assignor, and the Assignee hereby irrevocably purchases and assumes from the Assignor, without
recourse to the Assignor, as of the Effective Date, the interest (the “Assigned Interest”)
in and to the Assignor’s rights and obligations under the Loan Agreement with respect to the credit
facility contained in the Loan Agreement (the “Assigned Facility”), in a principal amount
and percentage of the credit facility as set forth in Schedule 1.



     The Assignor (a) makes no representation or warranty and assumes no responsibility with
respect to any statements, warranties or representations made in or in connection with the Loan
Agreement or the execution, legality, validity, enforceability, genuineness, sufficiency or value
of the Loan Agreement, any other Loan Document or any other instrument or document furnished
pursuant thereto, other than that it has not created any adverse claim upon the interest being
assigned by it hereunder and that such interest is free and clear of any adverse claim; (b) makes
no representation or warranty and assumes no responsibility with respect to the financial condition
of Borrower or the performance or observance by Borrower of any of its obligations under the Loan
Agreement or any other Loan Document or any other instrument or document furnished pursuant hereto
or thereto; and (c) attaches the Note held by it evidencing the Assigned Facility and requests that
Agent exchange such Note for a new Note payable to the Assignor (if the Assignor has retained any
interest in the Assigned Facility) and a new Note payable to the Assignee in the respective amounts
which reflect the assignment being made hereby (and after giving effect to any other assignments
which have become effective on the Effective Date).



     The Assignee (a) represents and warrants that it is legally authorized to enter into this
Assignment and Acceptance; (b) confirms that it has received a copy of the Loan Documents, together
with copies of the financial statements delivered pursuant thereto and such other documents and
information as it has deemed appropriate to make its own credit analysis and decision to enter into
this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon
the Assignor, Agent or any other person which has become a Bank and based on such documents and
information as it shall deem appropriate at the time, continue to make its own credit decisions in
taking or not taking action under the Loan Agreement; (d) appoints and authorizes Agent to take
such action as agent on its behalf and to exercise such powers under the Loan Agreement as are
delegated to Agent by the terms thereof, together with such powers as are incidental thereto; and
(e) agrees that it will be bound by the provisions of the Loan Agreement and will perform in
accordance with its terms all the obligations which by the terms of the Loan Agreement are required
to be performed by it as a Bank including, if it is organized under the laws of a jurisdiction
outside the United States, its obligation pursuant to subSection 4.10 of the Loan Agreement to
deliver the forms prescribed by the Internal Revenue Service of the United States certifying



D-1 









 




as to the Assignee’s exemption from United States withholding taxes with respect to all
payments to be made to the Assignee under the Loan Agreement, or such other documents as are
necessary to indicate that all such payments are subject to such tax at a rate reduced by an
applicable tax treaty.




     This Agreement is conditioned upon the acceptance of Agent pursuant to the Loan Agreement.
The execution of this Agreement by Agent is evidence of this consent. Following the execution of
this Assignment and Acceptance, it will be delivered to Agent for acceptance by it and recording by
Agent pursuant to subSection10.1 of the Loan Agreement, effective as of the Effective Date (which
shall not, unless otherwise agreed to by Agent, be earlier than five Business Days after the date
of acceptance and recording by Agent of the executed Assignment and Acceptance).



     Upon such acceptance and recording, from and after the Effective Date, Agent shall make all
payments in respect of the Assigned Interest (including payments of principal, interest, fees and
other amounts) to the Assignee whether such amounts have accrued prior to the Effective Date or
accrue subsequent to the Effective Date. The Assignor and the Assignee shall make all appropriate
adjustments in payments by Agent for period prior to the Effective Date or with respect to the
making of this Assignment directly between themselves.



     From and after the Effective Date (a) the Assignee shall be a party to the Loan Agreement and,
with respect to the Assigned Interest, have the rights and obligations of a Bank thereunder and
under the other Loan Documents and shall be bound by the provisions thereof, and (b) the Assignor
shall, with respect to the Assigned Interest, relinquish its rights and be released from its
obligations under the Loan Agreement.



     This Assignment and Acceptance shall be governed by and construed in accordance with the laws
of the State of Michigan.



D-2 









 





     IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Acceptance to be
executed on Schedule 1 hereto by their respective duly authorized officers.



	 	 	 	 	 
	 	ASSIGNOR:

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	ASSIGNEE:

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	ACCEPTED BY AGENT



LASALLE BANK MIDWEST NATIONAL ASSOCIATION, as Agent

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 



D-3 









 






	 	 	 	 	 



SCHEDULE 1

TO

ASSIGNMENT AND ACCEPTANCE




	 	 	 
	NAME OF ASSIGNOR:
	 	 
	 

	 	 
	 
	 	 
	 NAME OF ASSIGNEE:
	 	 
	 

	 	 





	 	 	 
	EFFECTIVE DATE OF ASSIGNMENT:
	 	 
	 

	 	 





	 	 	 	 	 	 
	PRINCIPAL AMOUNT ASSIGNED
	 	ASSIGNEE’S PRO RATA SHARE
	(ASSIGNEE’S LOAN AMOUNT):
	 	IN LOAN
	 
	 	 	 	 	 
	$
	 	 	 	                  	%
	 	 
	 	 	 	 






D-4